Indian Oil & gas sector companies were witnessing buying action in trade in anticipation of a hike in natural gas prices for the first time in three years.
The Oil Ministry's proposal to price all domestically produced natural gas as per a complex international hub and imported LNG-based formula suggested by the Rangarajan panel will be taken up by Cabinet Committee on Economic Affairs (CCEA) meeting.
If approved, gas price will rise to $6.775 per million British thermal unit from $4.2 currently. The rates will jump to $8.55 in April 2014.
The CCEA had deferred the proposal to hike natural gas prices by a steep 60 per cent last week as Oil Minister M Veerappa Moily was away on an official tour.
Meanwhile, the power and fertiliser ministries have strongly opposed the move as it would result in cost of electricity generation rising to unviable levels and steep jump in urea subsidy.
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