India Gas Demand Rebounds to Near Pre-Conflict Levels in June as JKM Holds Above $21
Equirus shows India's gas consumption returned to near pre-disruption levels in June, but JKM above $21 and Hormuz disruptions threaten the outlook.
India's natural gas consumption recovered to near pre-disruption levels in June 2026, according to Equirus research, closing a fiscal quarter that opened with some of the steepest demand losses the country's gas sector had recorded in years.4
The earlier damage was sharp and measurable. Domestic gas consumption in April and May 2026 fell more than 10% year-on-year and 13% below February 2026 levels, dropping to roughly 170 million standard cubic metres per day, according to data cited by Livemint on July 10 (2026-07-10).2
The West Asia conflict drove most of that contraction. Disruptions to flows through the Strait of Hormuz, previously the conduit for roughly 20% of global LNG supply, pushed procurement costs sharply higher for Indian importers, the IEA said in its Gas Market Report for Q3, published July 7 (2026-07-07).1
Earnings damage landed quickly. Nomura Global Markets Research expects GAIL's EBITDA to fall 25% year-on-year in the quarter ending June 2026, the broker said in a note cited by Livemint on July 10 (2026-07-10), showing how rapidly elevated import costs translate into margin compression for India's largest gas transporter.2
The Equirus analysis describes the June rebound as broad-based across demand sectors, with the power segment among the key drivers. India's electricity consumption is forecast to grow 7% in 2026, an Asian Power report published July 26 (2026-07-26) noted, with gas-fired capacity supporting peak loads as the grid expands. That structural demand pull helped absorb the June recovery even while procurement costs remained elevated.4
Spot prices have not eased. JKM last printed $21.11/MMBtu on August 8 (2026-08-08), too high for much of India's price-sensitive industrial and city gas distribution sector to absorb without compressing margins or switching fuels where alternatives exist.1
The broader Asian context adds caution. Wood Mackenzie projected Asia Pacific LNG demand would fall 4.1% in 2026, sliding from 268 million tonnes in 2025 to 257 million tonnes, according to a report cited by Gasworld on July 14 (2026-07-14). That marks the second consecutive annual decline, reflecting how widely demand destruction has spread among buyers who sought alternatives rather than pay spot market prices.3
The IEA frames the global picture in similar terms. Gas demand is forecast to drop 0.5% in 2026 due to weaker use in power and industrial sectors, with Middle East supply disruptions the primary driver, the agency said in its July 7 (2026-07-07) report. India stands out as an exception on the demand-growth side but remains exposed to the same supply constraints weighing on markets elsewhere.1
Power demand growing at 7% gives Indian gas consumption a durable structural support that few other Asian markets can match right now. But import dependence means JKM moves translate directly into earnings pressure for GAIL and city gas distributors, which limits how quickly demand can recover even when the underlying growth drivers are in place.4,2
The June rebound gives companies and investors a more constructive data point after two difficult months. What the second half of calendar 2026 holds depends on whether Hormuz flows stabilise enough to ease Asian LNG spot prices from current levels and give Indian buyers sufficient headroom to sustain any momentum.1