LNG in World Markets: India’s LNG Demand Recovers but Domestic Gas Production Reins in Import Growth

LNG in World Markets

June 2021

Several forces are conspiring to place downward pressure on LNG demand in India. Demand may struggle to surpass 2020 levels if domestic gas production continues to rise and demand weakens from the Covid-19 pandemic. Higher spot prices could also curtail import growth. While buying interest has recovered in May after a second wave of the Covid-19 pandemic reduced LNG imports in April, India is expected to be hit by a third wave that could dampen LNG imports for the full year. The spread of the highly infectious Delta variant in some states has raised concerns, but the main obstacle to LNG import growth is an imminent increase in domestic gas production.

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