India sees a rise in LNG imports in February as spot prices fall
- 23-Mar-2023 5:17 PM
- Journalist: Robert Hume
India: India's LNG imports increased by 11% in February compared to the same month last year, according to figures from the nation's Oil Ministry. Indian businesses have benefited from the drop in spot prices, which dropped from $48/mn Btu at its peak in September 2022 to $18.12/mn Btu in January and then to $14.90/mn Btu in February, reaching 2.25 billion cubic metres. The increased imports of LNG also indicate an increase in usage year over year.
Increased capacity utilisation at India's regasification facilities has led to a spike in imports. This comes after a 16% decrease in LNG imports between 2021 and the previous year.
Given the increased buying interest, the demand for LNG imports is anticipated to increase in March. This coincides with the nation's anticipated 229GW peak power consumption as summer draws near. The Indian electricity ministry consequently gave the state-controlled utility NTPC the order to run all of its gas-based power facilities at maximum capacity.
Natural gas output in India increased domestically last month, rising 13% year over year to 2.6 billion cubic metres (m3). According to data from the Oil Ministry, of this, offshore fields contributed 1.8 billion m3, while onshore fields contributed 806 million m3.
Production at the offshore fields owned by the government-run Oil and Natural Gas Corporation (ONGC) and the private company Reliance Industries has been increasing. In numerous projects in the western offshore regions, ONGC is expected to invest $3.5 billion.
India's consumption of liquefied natural gas (LNG) increased by 7% on a yearly basis to 4.84 billion cubic metres last month. However, due to decreasing pricing for alternative fuels, consumption was down 6% from the prior month. Sectors including electricity and refining, as well as other industrial petrochemical consumers, have recently changed their use of fuels to ones like naphtha, boiler oil, coal and petroleum coke as a result of cost-cutting.
The front-half price for LNG deliveries to India and the Middle East as of March 22nd, 2021, was 13.335 USD per million British thermal units (mn Btu), a decrease of 3% from the previous month and a reduction of 70% since August 2020, before the conflict between Russia and Ukraine significantly increased spot prices in Asia and Europe.
India has taken a brave step to switch to a greener, cleaner form of energy. Recent plans by Prime Minister Narendra Modi to transform the nation's economy into one based on gas, with natural gas serving as a significant source of primary energy by 2030, were made public. The worldwide demand for oil is anticipated to rise from 5% to 11% as a result of this increase from the present 6% to 15%. With the help of this ambitious initiative, India may be able to obtain more inexpensive and environmentally friendly kinds of energy in the future.