India's natural gas demand was projected to decline by 2 per cent in 2026 despite an estimated 10 per cent increase in liquefied natural gas (LNG) imports, according to the International Energy Agency (IEA), highlighting the impact of elevated global prices, supply disruptions and falling domestic production.
The contrasting trends reflected the growing dependence on imported gas even as overall consumption weakened amid higher energy costs and pressure on price-sensitive industries.
The IEA's assessment came against the backdrop of disruptions to global LNG trade following the conflict in West Asia, which affected supplies from major producing countries and increased uncertainty in international energy markets.
Higher prices had prompted several Asian economies to reduce gas consumption or switch to alternative fuels, particularly in power generation and energy-intensive industries.
For India, however, declining domestic production had increased the need for imported supplies, even as demand growth slowed.
๐๐บ๐ฝ๐ผ๐ฟ๐ ๐ฑ๐ฒ๐ฝ๐ฒ๐ป๐ฑ๐ฒ๐ป๐ฐ๐ฒ ๐ถ๐ป๐ฐ๐ฟ๐ฒ๐ฎ๐๐ฒ๐ฑ
Data from the Petroleum Planning and Analysis Cell (PPAC) showed that India's domestic natural gas production declined by 4.4 per cent during April-September 2026, falling to 16,804 million standard cubic metres (MMSCM) from 17,585 MMSCM in the corresponding period a year earlier.
During the same period, LNG imports increased by 4.4 per cent to 18,189 MMSCM from 17,414 MMSCM.
Consequently, India's dependence on imported natural gas increased to 52.3 per cent from 50.1 per cent in the corresponding period of the previous financial year.
Overall natural gas consumption remained nearly unchanged at 34,769 MMSCM, compared with 34,773 MMSCM a year earlier.
The figures indicated that imported supplies had accounted for a growing share of India's gas requirements despite the absence of significant growth in overall consumption.
๐๐บ๐ฝ๐ผ๐ฟ๐ ๐ฏ๐ถ๐น๐น ๐ฟ๐ผ๐๐ฒ ๐ฎ๐ฏ ๐ฝ๐ฒ๐ฟ ๐ฐ๐ฒ๐ป๐
India's natural gas import bill increased sharply during the first half of the financial year as the West Asia conflict pushed up international energy prices.
According to PPAC data, the country spent $8.5 billion on LNG imports during April-September 2026, compared with $6.9 billion in the corresponding period last year.
The increase of approximately 23 per cent in import expenditure was substantially higher than the 4.4 per cent rise in import volumes, underscoring the impact of elevated international prices.
The higher import costs placed additional pressure on energy-intensive industries and increased the financial burden associated with securing overseas gas supplies.
In September alone, India's LNG import volumes declined by 8.5 per cent year-on-year to 2,957 MMSCM, although the import bill remained around $1.2 billion.
The divergence between import volumes and expenditure reflected the higher average cost of imported gas.
๐ช๐ฒ๐๐ ๐๐๐ถ๐ฎ ๐ฐ๐ผ๐ป๐ณ๐น๐ถ๐ฐ๐ ๐ฑ๐ถ๐๐ฟ๐๐ฝ๐๐ฒ๐ฑ ๐๐๐ฝ๐ฝ๐น๐ถ๐ฒ๐
The conflict in West Asia disrupted LNG shipments through the Strait of Hormuz, a critical route for energy exports from the Gulf.
The disruption prompted Indian importers to diversify their sources of supply, with countries such as the United States, Oman and Nigeria emerging as important alternatives.
According to shipping intelligence data, India's LNG imports increased by 17.8 per cent year-on-year during May-September, reaching 11.87 million tonnes.
Oman emerged as India's largest LNG supplier in September, overtaking the United States, as competition from European buyers redirected some American cargoes towards Europe.
Imports from Qatar, traditionally a major supplier to India, declined sharply during the period because of disruptions affecting Gulf exports.
The changing supply pattern demonstrated how Indian buyers had prioritised securing sufficient gas despite higher international prices.
๐๐น๐ผ๐ฏ๐ฎ๐น ๐ฑ๐ฒ๐บ๐ฎ๐ป๐ฑ ๐ฎ๐น๐๐ผ ๐๐ฒ๐ฎ๐ธ๐ฒ๐ป๐ฒ๐ฑ
The IEA had earlier projected that global natural gas demand would decline by approximately 0.5 per cent, or 20 billion cubic metres, in 2026.
The agency attributed the expected contraction to higher LNG prices, disruptions to energy-intensive industries and increased substitution of gas with alternative fuels.
Asian natural gas consumption was also forecast to decline by 0.5 per cent during the year, while European demand was expected to fall by more than 2 per cent.
For India, the outlook highlighted the challenges of balancing energy security, import dependence and affordability.
Although LNG remained essential for sectors such as fertilisers, city gas distribution and industrial manufacturing, sustained price pressures threatened to constrain consumption in industries capable of switching to other fuels.
The IEA's assessment underscored the importance of reliable overseas supplies and domestic production as India navigated a volatile international gas market.