With nearly 200 million tons of new liquefied natural gas (LNG) production capacity slated to come online globally by 2028, India's energy needs may soon be met at lower prices according to analysis.
Major players in the global LNG sector are working to boost supply significantly over the coming years through various projects currently under construction. Approximately 193 million metric tons per year of additional liquefaction capacity is on track for completion between now and 2028.
However experts forecast only modest growth in worldwide natural gas consumption over the same period, as some regions explore alternatives in light of climate commitments. The imbalance between expanding supply and more tempered demand dynamics could result in a buyers' market scenario for LNG.
For India which imports nearly half its total gas usage currently, largely in tankers, a buyers' market spells good news. As one of the world's top importers of LNG the nation stands to save on vital energy import bills. Lower LNG prices would support the government's aim to raise the role of natural gas in India's energy mix to 15% by 2030 from just over 6% currently.
Analysts estimate softer prices globally could keep consumer gas tariffs in check, helping boost consumption in sectors like city gas distribution and fertilizers. Increased use of the cleaner burning fuel also better aligns with India's climate goals. With domestic gas output seen peaking later this decade, relying more on imports presents a bridging strategy to transition towards renewables and emerging alternatives.
Overall the timing of projected oversupply in international LNG markets provides an opportunity for price-sensitive import-dependent countries. As developments are tracked, India's energy security and environmental objectives both appear on course to benefit from conditions emerging in the global marketplace.
