India's natural gas consumption recovered to near pre-disruption levels in June 2026, with demand climbing 7 per cent month-on-month and 2 per cent year-on-year to 197 million metric standard cubic metres per day (mmscmd), according to a research report by domestic brokerage firm Equirus. The report said the recovery was broad-based across key sectors, although rising global LNG competition and elevated spot prices could pose risks to the outlook.
Recovery driven entirely by imported gas
Equirus reported that the June increase was entirely driven by imported gas. LNG consumption rose 13 per cent month-on-month and 10 per cent year-on-year to 110 mmscmd, while domestic gas supply stayed flat month-on-month at 87 mmscmd and declined 8 per cent year-on-year. That pushed India's import dependence to 56 per cent. Excluding power demand, consumption rose 7 per cent month-on-month and 4 per cent year-on-year to 176 mmscmd, indicating a broadening recovery.
Equirus attributed the June consumption increase entirely to imported gas, with LNG volumes up 13 per cent month-on-month.
| June 2026 indicator | Level | Month-on-month | Year-on-year |
|---|---|---|---|
| Total gas consumption | 197 mmscmd | +7% | +2% |
| Consumption ex-power | 176 mmscmd | +7% | +4% |
| LNG consumption | 110 mmscmd | +13% | +10% |
| Domestic gas supply | 87 mmscmd | flat | -8% |
May revision reshapes the demand narrative
Equirus revised May consumption significantly higher, to 184 mmscmd from an earlier 169 mmscmd, and LNG imports to 97 mmscmd from 83 mmscmd. According to the brokerage, this revision has altered the demand narrative, suggesting the recovery was already stronger than initially estimated.
| May 2026 indicator | Revised | Earlier estimate |
|---|---|---|
| Consumption | 184 mmscmd | 169 mmscmd |
| LNG imports | 97 mmscmd | 83 mmscmd |
Sector demand was broad-based
June demand growth was led by city gas distribution (CGD), miscellaneous users and refineries, Equirus said:
- CGD consumption increased 2.3 mmscmd month-on-month to 58 mmscmd.
- Miscellaneous demand rose 3.9 mmscmd to 41 mmscmd.
- Refinery consumption increased 2.6 mmscmd to 15 mmscmd, supported by a 25 per cent rise in imports.
- Fertiliser and power demand also improved.
- Petrochemical consumption recovered to 7 mmscmd but remained sharply below year-ago levels.
India shifts LNG sourcing away from Qatar
India imported around 7 million tonnes of LNG during May-July, up 15 per cent year-on-year, despite a 91 per cent collapse in Qatar volumes, according to Equirus. The US emerged as the largest supplier, followed by Nigeria and Oman, reducing India's immediate dependence on Qatar.
Prices, competition and demand outlook
Equirus cautioned that stronger Chinese LNG buying is increasing competition for flexible cargoes. Asian spot LNG prices rose above $19 per million British thermal units in July and were above $20 at the time of the report, while European gas storage remained below historical averages. With new LNG projects ramping up globally, additional supply could eventually improve cargo availability. However, shipping constraints, sanctions and payment risks will remain important factors in determining whether incremental supplies reach buyers such as India at attractive prices.
On the demand side, Equirus expects July demand to remain strong, although slightly softer than June due to lower power consumption. Demand could weaken in August amid lower Morbi-related consumption and seasonal softness.
Sources:
