Shares of gas production firms drop on buzz of delay in gas price hike
Shares of three companies engaged in the business of natural gas production fell 0.07% to 1.91% at 12:37 IST on BSE on reports that the announcement of the new gas price may get deferred once again due to assembly polls scheduled by the end of year.
ONGC (down 1.91% at Rs 426.90), Oil India (down 0.09% at Rs 602.15), and Reliance Industries (down 0.07% at Rs 1,008) edged lower.
Meanwhile, the S&P BSE Sensex was down 51.82 points or 0.2% at 26,368.85.
According to reports, owing to forthcoming state elections expected to begin by September-end or October and the Election Commission effecting the model code of conduct for the same, chances are that the announcement of the new gas price may get deferred once again.
Elections are due in Haryana, Maharashtra, Jharkhand and Jammu and Kashmir by the end of the year.
The new gas price formula will be an alternative to the Rangarajan formula approved by the previous UPA government, under which domestic natural gas prices would have doubled to $8.4 per unit. The gas price hike as proposed by the previous UPA government from April 1 was not undertaken by the NDA government after it got elected as the doubling of rates would have led to increase in cost of fertilisers, power and CNG. The government on 25 June postponed the implementation by a further three months pending a comprehensive review.
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