India has significantly increased its liquefied natural gas (LNG) imports, with a notable surge recorded between May and July. This strategic move aims to secure critical energy supplies by diversifying away from the volatile Strait of Hormuz, a key global energy transit route recently impacted by regional conflicts.
Rising Imports and New Supply Partners
According to recent reports, India's LNG imports grew by 15.4% year-on-year during the May-July period, reaching a total of 7.08 million tonnes. This recovery follows a nearly 13% decline in March-April, at the onset of the West Asia conflict. The shift in sourcing has seen India significantly ramp up purchases from new partners.
- The United States emerged as India's largest LNG supplier during this period, providing 2.19 million tonnes—a remarkable 252.8% increase year-on-year.
- Nigeria supplied 1.31 million tonnes, with imports jumping by 123.8%.
- Oman contributed 1.22 million tonnes, marking a substantial 340.9% rise in shipments.
- Angola's exports to India increased by 71.3%, totaling 0.80 million tonnes.
Reduced Reliance on Traditional Routes
Historically, India has relied on LNG imports for approximately half of its natural gas demand, with about 60% of these imports traditionally routed through the Strait of Hormuz, primarily from Qatar and the UAE. However, disruptions in the narrow waterway prompted a strategic pivot.
During May-July, imports from Qatar plummeted by 91.3% year-on-year to just 0.23 million tonnes. Similarly, shipments from the UAE saw a 34.4% decline to 0.55 million tonnes, although UAE exports showed some recovery in June and July after earlier sharp falls.
Securing Domestic Demand Amid Challenges
Despite global price volatility leading many nations to curtail LNG purchases, India maintained strong buying interest. The country prioritized securing supplies to meet the demands of vital domestic sectors, including city gas distribution, fertilizers, power generation, and ceramics industries.
Industry sources indicate that some traditional suppliers, like the UAE and to a lesser extent Qatar, managed to sustain exports by utilizing brief windows of opportunity based on maritime security assessments, occasionally even switching off LNG tankers' transponders to avoid detection. A partial recovery in transits was observed following a US-Iran peace pact in mid-June, though vessel movements slowed again after the agreement collapsed in early July.