Soaring Demand Makes India 4Th Largest Importer Of LNG

(MENAFN- KNN India) New Delhi, Feb 24 (KNN) India's natural gas import expenditure has witnessed a significant increase, rising 17.2 per cent to USD 12.9 billion during April-January of the current fiscal year, according to data released by the Petroleum Planning and Analysis Cell.

The January figures alone showed an 8.3 per cent increase to USD 1.3 billion compared to the previous year, reflecting the country's growing energy demands.

The nation imported 31,347 million standard cubic meters of liquefied natural gas in the first ten months of FY25, representing a 21 per cent increase from the previous fiscal year.

Market analysts attribute this substantial growth to increasing demand and stabilised global natural gas prices, which had reached unprecedented levels in FY23.

The country's overall natural gas consumption grew by 10 per cent to 61,282 mmscm, primarily driven by increased demand from city gas distribution, fertiliser, and power sectors, pushing India's dependence on imported gas to 51.2 per cent from 46.5 per cent in the previous fiscal period.

Domestic production has failed to keep pace with the growing demand, showing only a modest 2.6 per cent increase during April-January. The state-owned Oil and Natural Gas Corporation's production declined to 15,763 mmscm from 16,189 mmscm last year, further widening the gap between domestic supply and demand.

The International Energy Agency projects a moderation in India's LNG imports for 2025, with growth expected to slow to 10 per cent from the current 21 per cent, citing tempered demand growth and ongoing global competition for LNG cargoes.

India has emerged as the world's fourth-largest LNG importer in 2024, accounting for 7 per cent of global LNG imports. This achievement has been primarily driven by robust demand from industrial and oil refining sectors, followed by residential, commercial, and transport segments.

The country's LNG import activity has been particularly notable, with cargo tenders for delivery increasing by 70 per cent year-on-year, supported by favourable pricing conditions.

In response to growing energy needs, Indian oil and gas companies are actively pursuing partnerships with US suppliers. Indian Oil is reportedly in discussions with Cheniere Energy for a long-term LNG supply agreement, while GAIL India is exploring potential stake acquisition in a US liquefaction facility.

These developments align with the recent bilateral commitments made during Prime Minister Narendra Modi's US visit, aimed at expanding energy trade between the two nations.

The Indian government's ambitious target to increase natural gas's share in the energy mix from 6 per cent to 15 per cent by 2030 has received positive feedback from analysts, who view enhanced US gas imports as a strategic step toward achieving this goal.

The IEA anticipates significant changes in global LNG market dynamics in 2025, as new liquefaction projects come online and Europe's pipeline supply concerns drive increased LNG import demand in the region.

(KNN Bureau)

MENAFN24022025000155011030ID1109241308