India Pauses LNG Buys as Prices Stay Too High

Key Moments

India’s top LNG importer said Asian spot prices must drop from $11 to $6-$7/MMBtu to boost demand.
India is expected to import around 29 million tons of LNG this year, but a 15% gas share in the energy mix would require about 100 million tons of capacity.
Price-sensitive Indian buyers have delayed long-term contracts for over a year, waiting for a supply glut that could shift market power to buyers.

India’s Price Threshold for Higher LNG Demand

India needs a significant drop in Asian LNG prices before it can expand imports. The head of the country’s largest LNG importer said current spot prices hover around $11 per million British thermal units (MMBtu). He expects demand to rise meaningfully only if prices fall to $6-$7/MMBtu.

Akshay Kumar Singh, CEO of Petronet Ltd, made these remarks at the India Energy Week conference, as reported by Bloomberg. His comments highlight the gap between current prices and the level required for Indian buyers to increase purchases substantially.

Import Needs Versus Energy Mix Ambitions

Singh noted that India will import roughly 29 million tons of LNG this year. However, raising gas to 15% of the energy mix would require far more. Achieving that target would need about 100 million tons of import capacity.

Metric	Current / Expected Level	Implied Requirement
Asian spot LNG price	About $11/MMBtu	$6-$7/MMBtu for major demand boost in India
India LNG imports (2026)	About 29 million tons	—
Import capacity for 15% gas share	—	Around 100 million tons

Delayed Long-Term Deals Amid Price Sensitivity

India is not rushing into long-term LNG contracts. Price-sensitive buyers are slowing negotiations, waiting for a supply glut. This could pressure sellers to accept lower prices.

Some buyers, more price-conscious than China’s, have postponed deals for over a year, Bloomberg reports. They anticipate market conditions will soon favor buyers.

Market Outlook: From Tightness to Potential Oversupply

Later this year, analysts expect a shift toward oversupply in the global LNG market. As a result, India and other Asian buyers could gain leverage in negotiating long-term contracts.

Supply growth from the United States and Qatar could lower Asian spot prices and Europe’s benchmark gas prices at the Dutch TTF. This increase may bring prices closer to levels acceptable for Indian buyers.

Short-Term Tightness Driven by Weather and Storage

Despite a potential future oversupply, current prices remain tight. Analysts say downward pressure may only appear after winter ends. Severe cold in the U.S. recently limited feedgas to LNG export facilities, pushing prices up.

Even in summer, buyers may not see major relief. Europe must refill gas storage, which is being drawn down at the fastest rate in five years. This demand could continue to support prices, limiting immediate benefits for India.