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India Protects City Gas Users Amid Hormuz Crisis Threatening LNG Demand
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CNBC TV18•12-10-2026, 16:29
India Protects City Gas Users Amid Hormuz Crisis Threatening LNG Demand
- •India safeguarded city gas supplies by curtailing deliveries to fertiliser plants, refineries, and industrial users during the Middle East conflict.
- •South Asia's overall LNG demand is projected to fall by about 6 million tonnes in 2026 due to the closure of the Strait of Hormuz.
- •Pakistan and Bangladesh faced severe disruptions because of their heavy reliance on Qatari and UAE LNG supplies.
- •Spot LNG prices surged significantly, reaching up to $26.4 per mmBtu in September and putting immense pressure on regional subsidies and budgets.
- •Wood Mackenzie warns that South Asian governments must address structural vulnerabilities through supply diversification and infrastructure resilience.
Key Questions Answered
India deployed a tiered demand-management strategy that kept city gas distribution unaffected while reducing supplies to the fertilizer, refinery, and industrial sectors during March and April 2026.
South Asia's overall LNG demand is expected to fall by about 6 million tonnes in 2026, reversing initial projections of 2.7 million tonnes of growth, due to supply disruptions and soaring spot prices.
Pakistan and Bangladesh were heavily dependent on Gulf supplies, with Qatar accounting for 99% of Pakistan's and over 70% of Bangladesh's LNG imports in 2025, leaving them extremely vulnerable when shipments through the Strait of Hormuz were interrupted.
