India’s Liquefied Natural Gas imports are poised to more than double by 2030, riding on a consumption surge and expansion of infrastructure projects, a report by International Energy Agency said on February 12.
"India’s gas market is entering a new phase of growth, supported by significant infrastructure development and clear policy direction," IEA’s Director of Energy Markets and Security, Keisuke Sadamori said.
The IEA report cited three key factors that will drive India's energy demand, namely - urbanisation, industrialisation, the emergence of a wealthier middle-class keen for mobility and tourism. In addition to these, the steps to expand access to clean cooking fuel will result in expansion in oil demand.
The IEA report said India will become the largest source of global oil demand growth between now and 2030. This will come as demand in developed economies and China will 'initially slow and then subsequently goes into reverse' in our outlook, said IEA.
"As energy transitions gather pace and China’s economy shifts gear towards a less energy-intensive phase, India will assume the position as the world’s largest source of oil demand growth this decade," the report said.
India's oil companies are also investing heavily to ramp up refining capacities to meet the rise domestic demand. "Over the next seven years, 1 mb/d of new refinery distillation capacity will be added – more than any other country in the world outside of China," said the IEA report.
India’s LNG import will also be augmented by an increase in domestic production, to meet the energy demand by 2030.
India's major importers of LNG are major PSUs like Gail, IOC, BPCL and Petronet LNG, a joint venture that operates LNG terminals at Dahej in Gujarat, and Kochi in Kerala. Petronet's CEO had recently said that higher LNG production in the US could benefit India, as it will have a stabilizing effect on international LNG prices.
US President Donald Trump had recently ordered the Department of Energy to start assessing LNG export, after the Biden administration had frozen them.
"For a consuming nation (like India), it is expected that if prices are in the range of $7-8 per million British thermal units (mmBtu), the consumption will drastically improve because there is no shortage of customers, they are just price sensitive," Petronet LNG CEO Akshay Kumar Singh said during the December quarter earnings call.
Indian is also considering on importing more energy from the US, with Prime Minister Narendra Modi heading to Washington for a meeting with President Donald Trump.
The report said rising electric vehicles will avoid as much as 4.8 lakh b/d of extra oil demand between 2023-2030, without which India’s oil demand would be much higher.
IEA also lauded India's ethanol blending efforts, adding that it is already the world’s third-largest producer and consumer of ethanol, with domestic production tripling over last five years.
India's ethanol blending rate of 12% is among the world’s highest, and the country has advanced its deadline of doubling ethanol blending to 20% by Q4CY26.
Minister of Petroleum and Natural Gas Hardeep Singh Puri recently said India is committed to buying economically-priced crude oil, with government’s priority fixated on making energy available to consumers “at all times”.
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