India’s LNG Imports Rise 5% Despite Higher Prices; Fertiliser Sector Drives Demand

India continued to bring in more natural gas this fiscal even as LNG became significantly costlier, as per news reports. Imports rose as demand from fertiliser makers and city-gas networks held up, while CNG use increased, and domestic gas production declined. 

The higher prices are now becoming a concern. Spot LNG has climbed to around $25 per mmbtu, with disruptions to Gulf supplies amid the Iran war pushing India to source around 35-40% of its imports from the spot market. 

LNG Imports Rise in Value and Volume 

Oil ministry data shows LNG imports increased 5% year-on-year by volume during April-July 2026, while their value jumped 25% to $5.6 billion. Kpler data also showed imports in August 2026 were 5% higher than July 2026. 

Asian spot benchmark JKM averaged $19 per mmbtu between April 2026 and August 2026, compared with $12 during the same period last year. Long-term contracted LNG has been cheaper, with crude-linked supplies estimated at around $11-12 per mmbtu based on the April-August 2026, Brent average of $90 per barrel. 

Fertiliser Remains Biggest Import Driver 

Domestic gas consumption has broadly held up, rising around 0.5% year-on-year to 22.9 bcm. Fertiliser was the largest source of LNG demand, taking about one-fourth of total imports during April-July. 

Gas consumption from the fertiliser sector was 5% higher than last year. With LNG prices higher, that increase could also add to the government's fertiliser subsidy bill. 

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Conclusion 

India's LNG demand has remained firm despite the jump in spot prices. However, with a sizeable portion of imports now coming from the spot market, higher international gas costs are putting pressure on the economics of consumption, particularly in the subsidised fertiliser sector. 

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