India’s top gas importer Petronet sees ‘huge jump’ in demand as prices ease
India’s top gas importer Petronet LNG expects a ‘huge jump’ in local gas demand for at least six months due to a softening of global prices of liquefied natural gas(LNG), its chief executive A. K. Singh said on Wednesday. Indian gas demand is already showing signs of recovery after global LNG prices fell to about $11 per million British thermal units in Asian markets. Petronet operated its 17.5 million tonnes a year Dahej LNG terminal on the west coast at 97% in April compared to 77% in the three months to March, Singh told reporters on its quarterly earnings call. “If the prices stabilise we can expect a huge jump,” Singh said, adding Indian gas demand was price sensitive. India wants to raise the share of gas in its energy mix to 15% by 2030 from 6.2% at present. Singh said Indian LNG imports could have risen to 30 million tonnes a year had there not been abnormal situations such as the COVID pandemic and Russia’s war in Ukraine. In the fiscal year to March 2023, India imported 20.1 million tonnes of LNG, down from 25.6 million tonnes in 2019/20 according to the government data. “Things are looking quite bright as of now… We expect this trend to continue at least till six months from now,” Singh said. He added demand in the later part of the year would depend on the winter season in the West and its implication on LNG prices.
Indian Gas Exchange volumes up 215% YoY in April
Trading volumes on the Indian Gas Exchange (IGX) rose 215% year-on-year to 1,790,700 mmBtu (~45 mmscm/1.5 mmscmd) in April, as per data released by the exchange. However, the month-on-month, volumes fell 68% due to decreased spot demand as long-term supplies rose. IGX executed a total of 74 trades during the period. According to data, Hazira was the most active delivery point for free market gas, while Gadimoga saw the trading of domestic ceiling price gas. Other delivery points included Dahej, Ankot, Suvali, and Mhaskal. IGX traded a total of 903,650 mmBtu of domestic ceiling price gas during the month, with 785,850 mmBtu traded at the ceiling price of $12.46/MMBtu and 117,800 mmBtu below the ceiling price at $11.5, as per the Ministry of Petroleum and Natural Gas (MoPNG) notification dated 13 January, 2023. The exchange offers delivery-based trade in six different contracts, including Day-Ahead, Daily, Weekday, Weekly, Fortnightly, and Monthly, across six regional gas hubs in India. The Gas Index of India (GIXI) for April was ₹1,075/$14 per MMBtu, down 8% from previous month.