October 14, 2026: India’s efforts to protect gas supplies to households and transport users have come at a higher cost, with liquefied natural gas (LNG) tender prices rising to $26.4 per million British thermal units (mmBtu) in September, according to consultancy Wood Mackenzie.

LNG tender award prices ranged between $16.8 and $18.8 per mmBtu between March and June before climbing sharply in September. The increase comes as the conflict in West Asia disrupts supplies from Qatar and the United Arab Emirates, while the closure of the Strait of Hormuz restricts shipments.

India has responded by prioritising supplies to city gas distribution networks while cutting deliveries to fertiliser plants, refineries and industrial users during March and April. The approach helped protect supplies for priority consumers, but the higher cost of imported gas has increased pressure on the energy sector.

The price rise could have implications for fertiliser subsidies, industrial production costs and the price of gas-based services. However, the final impact on consumers will depend on how the higher procurement costs are absorbed by companies and the government.

Fertiliser production and subsidies

India has sought to maintain fertiliser production despite the supply disruption. Government subsidies helped sustain output, with daily urea production rising by 12,000-15,000 tonnes. Monthly production reached record levels of 2.519 million tonnes in May and 2.537 million tonnes in June, according to Wood Mackenzie.

(Source: Business Today)