A searing summer that fired up electricity demand coupled, with expanding industrial and commercial operations, pushed India to import record volumes of liquefied natural gas (LNG) in the last calendar year, accounting for 7 per cent of imports world-wide.
Shell, in its LNG outlook, said India increased annual imports to a record high of 27 million tonnes (mt) in 2024 calendar year (CY), a 20 per cent Y-o-Y growth.
“India bought record volumes to help meet stronger power demand due to hotter weather in early summer. India imports LNG to increase its natural gas supply, which is used for power-generation, cooking and heating purposes, and to meet industrial demand around the country,” the report said.
The International Energy Agency (IEA) in its gas market report for Q1 2025 CY pointed out that LNG cargoes by the world’s fourth largest importer grew by a record of over 6 billion cubic meters (BCM), or 21 per cent Y-o-Y, in 2024.
The agency attributed the development to robust demand for RLNG (regasified LNG) in the city gas distribution (CGD) and oil refining sectors, as well as softer domestic gas production dynamics.
Higher imports
Going ahead, Shell projected that the demand for gas continues to gather pace across Asia, with China and India significantly increasing their regasification and downstream infrastructure.
India is also moving ahead with building natural gas infrastructure and adding gas connections to 30 million people over the next five years, it added.
India remains an attractive market for long-term suppliers, said IEA adding, just over 15 BCM per year of new sales and purchase agreements were signed in 2024, including the renewal for 20 years of Qatar’s 10 BCM per year contract starting from 2028.
According to a recent report by Wood Mackenzie, falling production amidst rising demand for LNG — considered the best transition fuel — is expected to push up imports, with India likely to become the world’s third largest importer, after China and Japan by 2032, with in-bound cargoes accounting for 75 per cent of its gas consumption.
“We expect LNG demand to continue to grow in the coming years, exceeding 37 mtpa by 2030 and 88 mtpa by 2050, as India’s demand for gas rises, while its domestic production shrinks. By 2032 already, LNG should account for around two-thirds of India’s gas consumption and will become the third largest importer of LNG after China and Japan,” Wood Mac said.
Increasing supplies
Besides, more LNG supply is expected to come online globally in the next 4-5 years, which will soften prices favouring more Indian purchases.
“More than 170 million tonnes of new LNG supply is set to come on to the market by 2030, helping to meet growing long-term global demand for gas. But project start-up timings remain uncertain,” Shell said in its report.
Significant growth in LNG supply will come from Qatar and the US. The US is set to extend its lead as the world’s largest LNG exporter, potentially reaching 180 mt a year by 2030 and accounting for a third of global supply, it added.