Prices of natural gas in India are likely to be cut to $1.9-1.94 — the lowest in more than a decade — from October, denting the revenues of producers such as ONGC who are already incurring huge losses on production.

A price revision is due from October 1 and going by the changes in the benchmark rate in gas exporting nations, the price is likely to be anywhere between $1.90 and $1.94 per million British thermal unit (mBtu), sources privy to the development said.

This will be the third straight reduction in rates in one year. Prices were cut by a steep 26 per cent to $2.39 per mBtu in April.

Prices of natural gas, which is used to produce fertiliser and generate electricity and is also converted into CNG for use in automobiles as fuel and cooking gas for households, are set every six months — on April 1 and October 1 each year.

Sources said the cut in prices would mean a widening of losses for India’s top oil and gas producer ONGC.

Oil and Natural Gas Corp (ONGC) had posted a Rs 4,272-crore loss in its gas business in 2017-18, which is likely to widen to over Rs 6,000 crore in the current fiscal (April 2020 to March 2021), they said.

ONGC has been incurring losses on the 65 million standard cubic metres per day of gas it produces from domestic fields soon after the government in November 2014 introduced a new gas pricing formula.