India's Gas Economy Is Hitting a Structural Wall — And the Data Is Alarming

DELHI, India - Nov. 26, 2025 - PRLog -- India's gas economy is experiencing one of its broadest and sharpest contractions in over a decade, according to the April–September 2025 Monthly Bulletin released by the Petroleum & Natural Gas Regulatory Board (PNGRB). The data reveals a rare and troubling pattern: declines across domestic production, LNG imports, and consumption in nearly every major gas-consuming sector.

The bulletin shows that domestic gas output fell 2.9%, while LNG imports declined 11.1%, marking an unusual dual contraction seldom seen together. Total natural gas consumption dropped 7.1%, signalling that the slowdown is demand-led and not merely a supply fluctuation.

The most significant sectoral decline is visible in industry, where gas consumption dropped 37.4% year-on-year. This category, which spans ceramics, metals, chemicals, and MSME clusters, typically serves as a diversified demand base. A contraction of this scale indicates serious competitiveness issues driven by high delivered prices, accelerated fuel-switching, and weak manufacturing activity.

The power sector posted a 17% decline in gas burn — its lowest level in several years. Gas-based power, once considered a flexible buffer for grid balancing, is now witnessing sustained month-on-month declines. This trend underscores the diminishing role of gas-fired capacity amid rising efficiency of coal fleets, expanding renewable output, and limited grid reliance on gas.

Refinery gas consumption fell 18%, reflecting downstream softness, lower throughput, and possible alignment with subdued petroleum product exports. Meanwhile, LNG-based trucking — a policy-backed narrative since 2020 — remains stalled, with registrations standing at a statistical zero of just 0.004 lakh vehicles.

With CGD industrial-commercial demand stagnating and pipeline development slowing (steel pipeline down 11.5%), the bulletin suggests a broad-based demand correction rather than isolated weakness.

Only the fertilizer sector showed positive growth (+8.8%), driven entirely by policy-linked allocations rather than market momentum.

Collectively, the data points to a structural weakening of India's gas demand fundamentals, raising concerns about the feasibility of achieving the national target of 15% gas share in the energy mix. High landed prices, accelerating electrification, and the growing competitiveness of liquid and alternative industrial fuels are reshaping consumption patterns faster than anticipated.

The PNGRB bulletin offers a clear signal: India's gas transition is losing ground, and without competitive pricing and targeted sectoral reforms, the country risks a prolonged stagnation in gas adoption.

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