India's Natural Gas Imports Rise Despite Price Surge
India's natural gas imports continue to rise despite a significant surge in prices this fiscal year. The demand for natural gas has been driven by the fertiliser sector, growing CNG vehicle sales, and limited supply of alternative fuels such as LPG.
The domestic gas production has also fallen, contributing to the increased reliance on imports. However, industry executives warn that a recent spike in spot liquefied natural gas (LNG) prices to $25 per mmbtu may partially dent demand or push consumers towards alternative fuels.
With Gulf gas supplies disrupted due to the Iran war, India is currently sourcing about 35-40% of its imports from the spot market. The Asian spot benchmark JKM averaged $19 per mmbtu in the April-August period, up from $12 in the same period last year.
Sonar Ranjan, analyst at analytics firm Kpler, attributes the resilience in India's LNG imports to continued growth in city-gas demand and broadly stable fertiliser consumption. These sectors benefit from priority domestic gas allocation and government subsidies, making them relatively price-insensitive.