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India Revises Domestic Natural Gas Price for December

2024-12-03

The price of domestic natural gas for December 2024 has been revised to $7.29 per million metric British thermal units (mmBtu), down from $7.53 in November, according to a notification by the Ministry of Petroleum and Natural Gas (MoPNG). Despite the reduction, the domestic gas price remains capped at $6.5 per mmBtu under the country’s pricing framework.

Pricing Framework Under the revised mechanism, domestic natural gas prices are linked to imported crude oil, constituting 10% of the Indian crude basket. Prices are revised monthly, with a floor and ceiling set at $4 and $6.5 per mmBtu, respectively.

The new rate applies to natural gas produced from legacy fields operated by Oil and Natural Gas Corporation Ltd (ONGC) and Oil India Limited (OIL). The guidelines, introduced in April 2023, aim to balance global market trends with the interests of domestic producers and consumers.

Strategic Impact The updated pricing aligns with India's broader energy policies to stabilize the natural gas sector while encouraging production and fair market pricing. Industry stakeholders, including ONGC, OIL, and GAIL, have been informed of the changes to ensure seamless implementation.

Experts note that the framework demonstrates India’s commitment to global energy standards, fostering sectoral growth and ensuring energy security.