Gas price move sends ONGC, OIL stocks soaring

The petroleum ministry's proposed gas price hike for domestically sold gas from the present $4.2 million British per unit (mBtu) to over $7 per mBtu sent the stocks of Oil and Natural Gas Corporation (ONGC) and Oil India (OIL) rallying on Thursday. ONGC and OIL produce gas from nominated fields, called APM gas, and a hike in the gas prices will be positive for the companies. The last time the government hiked administered pricing mechanism (APM) gas prices was in April 2010, from $1.9 per mBtu to $4.2 per mBtu, a rise of 133 per cent. APM gas price has been raised nearly four times since 2005. (Click on graphic)