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Why India’s Natural Gas Spending Rose Faster Than Its Import Volumes
Author
Shoonya Team
Data from the Petroleum Planning and Analysis Cell (PPAC) shows India spent $8.5 billion on natural gas imports between April and September FY27. A year earlier, the figure was $6.9 billion. The cost of overseas supplies rose as energy prices climbed during the West Asia conflict.
Did Prices or Volumes Push the Bill Higher?
The rise came mostly from higher prices. Import quantities grew much more slowly than spending.
| Period | LNG Import Volume (MMSCM) | Change |
|---|---|---|
| April to September FY26 | 17,414 | Not applicable |
| April to September FY27 | 18,189 | Up 4.4% |
The import bill held at $1.2 billion, the same as in September last year, even though volumes fell 8.5% to 2,957 MMSCM from 3,233 MMSCM. This means each unit of imported gas cost more on average than a year ago.
How Did Monthly LNG Spending Move in FY27?
| Month | LNG Imports ($ billion) |
|---|---|
| April | 1.18 |
| May | 1.35 |
| June | 1.80 |
| July | 1.66 |
| August | 1.24 |
| September | 1.20 |
Monthly spending was highest in June and then fell over the next three months.
Why Is Imported Gas Taking a Larger Share of Consumption?
Overall demand stayed flat while domestic production fell, so imports made up a bigger share of supply.
| Indicator | April to September FY26 | April to September FY27 |
|---|---|---|
| Domestic production (MMSCM) | 17,585 | 16,804 |
| Total consumption (MMSCM) | 34,773 | 34,769 |
| Import dependence | 50.1% | 52.3% |
How Are Strait of Hormuz Risks Affecting Energy Supply?
The Strait of Hormuz is a key route for global oil and LNG trade. The conflict has affected it in several ways:
- Commercial ships have been attacked, and maritime traffic has been disrupted
- Shipments of oil and gas from the Gulf have become less certain
- Countries that rely on imports are more exposed to changes in global prices and freight costs
- For India, energy prices that stay high could increase the import bill and put pressure on the current account deficit
What Changed in India’s Petroleum Product Trade?
Petroleum products moved in the opposite direction from gas. Import spending fell, and export earnings rose.
| Indicator | April to September FY26 | April to September FY27 |
|---|---|---|
| Product import value | $11.4 billion | $8.6 billion (down 24.5%) |
| Product import volume | 25.6 million tonnes | 13.4 million tonnes |
| Product export value | Not specified | $26.6 billion (up 33%) |
| Product export volume | Not specified | 26.2 million tonnes (down 18%) |
Export volumes fell because domestic supply was given priority during the global supply shortage. Export earnings still went up because petroleum product prices rose along with oil prices.
Final Outlook
Security risks around the Strait of Hormuz persist, and talks between Washington and Tehran have made little progress. With domestic gas output falling, the cost of India’s gas supply in the second half of FY27 will depend more on global cargo prices and freight conditions.
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