FCC

State run firms to explore plans amid LNG crisis

2022-08-18

Instead of securing immediate supplies in the face of rising gas prices, the central government is considering a plan that would involve state-run energy firms making participatory commitments in global liquefied natural gas (LNG) contracts that would be available after five years.

This comes at a time when LNG prices have remained high due to disruptions in gas supplies to India caused by the ongoing Russia-Ukraine conflict. There will most likely be no long-term global supply contracts available in the next three years. India currently imports 85% of its oil requirements and 54% of its gas requirements.

Supply cuts from Russia have led European nations to corner a bulk of international contracts to stock up for winter. This has resulted in crowding out of Asian buyers, experts said.

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