HOUSEHOLDS using piped gas will have to pay 1.87 cents per kWh from this Friday, which will add $1.70 to their monthly gas bill.

City Gas, announcing the tariff increase, blames 'substantial increase in fuel oil price' as a reason for the hike.

The current increase represents a 9.7 per cent hike from the current 19.34 cents per unit.

Piped gas prices are reviewed quarterly to bring them in line with supply. The last hike was in February this year when tariffs went up by about 7 per cent.

Natural gas price is pegged to that of high sulphur fuel oil (HSFO). The last revision saw the forward pricing of HSFO forecast at US$494.97 (S$872.41) per metric tonne.

But the current forecast for HSFO for Aug 15 to Oct 31 is US$632.18 per metric tonne - an increase of 24.9 per cent since the February revision.

So the general tariffs have been revised to 21.21 cents per unit, up from the current 19.34 cents per unit, which kicks in on Friday.

City Gas supplies piped gas to 90 per cent of the residents living in new Housing Board estates and private properties, as well as commercial operations like hawker centres and hotels.