New Delhi: India is poised to transition to a new domestic gas pricing regime based on crude oil prices starting 1 April, as suggested by the Kirit Parikh panel, with a person familiar with the development saying that the proposal may get cabinet approval this month.
In November, the Kirit Parikh committee made several recommendations to the petroleum ministry, including pricing locally produced natural gas at 10% of crude oil prices and implementing a floor price of $4 per mmBtu and a ceiling price of $6.5 per mmBtu.
“Efforts are on to get things cleared by 1 April. The new rates are about to come. It is being tried that the new rates come on the basis of the formula suggested by the Parikh panel," the person cited above said, requesting anonymity.
Another person aware of the development said that the committee suggested linking the prices to crude oil in this case. “They would be linked to the prices at which India purchases oil, which would be the Indian crude basket," the person said, also declining to be named. The Indian basket of crude oil represents a derived basket comprising sour grade (Oman and Dubai average) and sweet grade (Brent Dated) of crude oil processed in Indian refineries.
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