Starting from April 1, the price of the domestically produced gas is presumed to go higher on the end of an upward trend across different international hubs, also including the indices used as benchmarks.

The revenues of the public-sector as well as the private explorers and producers like Oil and Natural Gas Corporation Ltd (ONGC), Oil India Ltd (OIL), and bp-Reliance Industries are likely to be boosted by the six-monthly revision in government-stipulated prices of domestic gas. According to Prashant Vasisht, Vice President and Co-Head, Corporate Ratings at ICRA Ltd A $1 increase in the price per mBtu (million British thermal units) will increase annual profit before tax by ₹4,300 crores for ONGC and ₹550 crores for OIL. After consecutively falling for three turns during the COVID-19 pandemic, in the last revision during October 2020, the price fell to a record low. It is currently standing at $1.79 per mBtu, the price ceiling for the production from discoveries in deepwater, ultra-deepwater, and high pressure-high temperature areas, as dictated by the government is currently at a record low of $4.06 per mBtu. Both the public-sector and private oil and gas companies have campaigned for a long time to change the pricing formula, which uses low-priced international benchmarks from gas-surplus economies such as the US, UK, Canada, and Russia. According to Deepak Mahurkar, Partner, PwC, the indices which are currently being used are inappropriate and need to be changed. They are one of the main reasons causing investors not to take interest in India.

The government is trying to attract international oil and gas majors to invest in the domestic upstream industry, as the potential for gas production is believed to exist in deep-water and ultra-deep-water areas, and international expertise is crucial for exploiting it. Meanwhile, some private producers have found ways to avoid the price ceiling, such as an affiliate buying gas from the producer to further sell it to the other companies to circumvent the ceiling. Following the example of Reliance, during the last month, ONGC also floated a gas subsidiary to buy its own produce.