India’s import of LNG (liquified natural gas) is expected to decline in 2025 on the back of moderating demand and continued competition for LNG cargoes internationally, as per the International Energy Agency. The agency has estimated the country’s growth in LNG imports to slow down to 10% in 2025 against 21% recorded in the calendar year 2024.
IEA believes that 2025 is set to bring about a shift in global LNG market dynamics as more liquefaction projects ramp up or come online and as pipeline supply risks in Europe lead to a return to growth in LNG imports for the region.
The agency expects natural gas demand in India to increase by 8% (or 6 billion cubic meters) in 2025, assuming average weather conditions, driven by the country’s growing energy needs and rapid economic expansion.
In 2024, the country became the world’s fourth-largest LNG importer, accounting for nearly 7% of global LNG imports.
Gas consumption (including net production and LNG imports) in India rose by 11% year on year last year, driven by industrial demand and oil refining, as per the agency’s preliminary data. “This demand growth led to a 21% y-o-y rise in LNG imports, supported by average spot LNG prices in India that were more than 12% lower than a year ago,” IEA said.
The growth in gas demand was further supported by residential and commercial gas consumption (up 14%) and transport sector (up 12%).
India’s LNG imports increased throughout 2024, supported by lower relative prices. As per the agency, the number of LNG cargoes tendered for delivery in 2024 (both supplier offers and user invitations) in India increased by 70% on-year.
The 21% growth in LNG imports in 2024 is also attributed to robust demand for RLNG (regasified LNG) in the city gas distribution as well as softer domestic gas production dynamics.
During the last year, India signed over 15 bcm per annum of new sales and purchase agreements, including the renewal for 20 years of Qatar’s 10 bcm per year contract starting from 2028.
“The strategy of diversifying LNG supplies in the coming years is reflected in the signing of new long-term contracts with portfolio players totalling more than 4 bcm per year, with the remainder of the 15 bcm per year of newly signed contracts coming from the United Arab Emirates and the United States,” IEA said in its report.
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