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Indian LNG import rises in January 2023 thanks to lower spot prices

Indian LNG import has surged during January 2023 by 7.9% year on year basis. India’s LNG imports in January came in at 2.26bn cubic meters (1.67mn metric tons), up 7.9% year/year, according to Petroleum Planning and Analysis Cell (PPAC) of Ministry of Petroleum and Natural Gas.

The cumulative imports of 22.66bn cubic meters in the first ten months of the year were lower by 14% compared with the corresponding period of the previous year.

The LNG imports cost $1.6bn last month versus $1.3bn in the same month of the previous year, PPAC said.

Indian LNG import will surge further from February onward as current spot price level of around $15 is widely acceptable among most industrial end-users. Indian buyers are expected to issue buy tenders for delivery during summer months when state-owned and private power companies experience sudden spike in demand for electricity. Among importers, state-owned GAIL India, Petronet LNG, Indian and GSPC are expected to issue series of buy tender to take advantage of the lower prices.

European LNG demand has remained subdued because of around 64% gas reserves which is far better compared to previous year and warmer weather conditions.   

Among South Asian buyers, India and Bangladesh had nearly stopped buying spot LNG cargoes since middle of last year. Bangladesh has already secured two spot cargoes- one each for February and March and it is expected to buy at least five to six more cargoes by May or June.

Europe Union’s decision to replace Russian piped gas with LNG, had resulted into an extraordinary spike in spot prices during 2022 following Russia-Ukraine war and subsequent drastic cut in piped gas supply from Russia to Europe.