What Happened
- Petronet LNG Ltd — India's largest LNG importer — issued force majeure notices to QatarEnergy and to its domestic off-takers (GAIL, Indian Oil Corporation, and Bharat Petroleum) after Qatar halted LNG production at Ras Laffan, the world's largest LNG export facility.
- QatarEnergy suspended production and shipping following Iranian drone attacks on Ras Laffan, part of the broader West Asia conflict that began with US-Israeli strikes on Iran on February 28, 2026, and Iran's subsequent retaliatory attacks on regional energy infrastructure.
- The Strait of Hormuz blockage prevented vessels from safely transiting to reach Ras Laffan, making it physically impossible for contracted LNG cargoes to be loaded and shipped to India.
- India sources approximately 40% of its LNG imports from Qatar, making this the most significant supply disruption to India's gas sector since its LNG import infrastructure was established.
- Industrial users and city gas distribution (CGD) companies in India face potential supply cuts of up to 40%, affecting Compressed Natural Gas (CNG) availability for vehicles and piped natural gas (PNG) for household cooking.
Static Topic Bridges
Petronet LNG and India's LNG Import Infrastructure
Petronet LNG Limited is India's largest LNG importer and regasification company, established as a joint venture in 1998 by the Government of India through major PSU participants including GAIL, ONGC, IOC, and BPCL (each holding equity stakes), along with Gaz de France (now Engie). Petronet operates two LNG regasification terminals: Dahej (Gujarat) with a capacity of 17.5 MMTPA, and Kochi (Kerala) with 5 MMTPA capacity. The Dahej terminal is the largest LNG import terminal in India. Petronet has long-term Sale and Purchase Agreements (SPAs) with QatarEnergy for supply of LNG, which forms the backbone of India's gas grid supply.
- Petronet LNG Ltd: India's largest LNG importer; incorporated 1998 as a public-private JV
- Shareholders: GAIL, ONGC, IOC, BPCL (each ~12.5%), Government of India, Engie
- Dahej terminal (Gujarat): 17.5 MMTPA capacity — India's largest LNG import terminal
- Kochi terminal (Kerala): 5 MMTPA capacity
- Long-term SPA with QatarEnergy: cornerstone of India's LNG supply security
- Off-takers: GAIL, IOC, BPCL — distribute regasified LNG across India's gas grid
Connection to this news: Petronet's central role as India's primary LNG gateway means that a force majeure at Petronet cascades directly to all downstream gas consumers — industrial plants, power stations, fertilizer units, and CGD companies supplying CNG and PNG to households and vehicles.
City Gas Distribution (CGD) Network in India
City Gas Distribution refers to the infrastructure that delivers natural gas to end-users in urban areas through two primary delivery modes: Piped Natural Gas (PNG) for homes and commercial establishments, and Compressed Natural Gas (CNG) for vehicles. The Petroleum and Natural Gas Regulatory Board (PNGRB) oversees CGD licensing and regulation in India. CGD companies have been awarded geographic areas (Gas Authority Areas or GAs) through competitive bidding. Over 630 districts have been awarded for CGD development, covering almost all of India. As of recent data, India had approximately 6+ million PNG connections and thousands of CNG stations.
- CGD delivers gas as PNG (homes/commercial) and CNG (vehicles)
- PNGRB: regulator for CGD licensing, network tariffs, and consumer protection
- Over 630 districts covered under CGD geographical area licensing
- Key CGD companies: Indraprastha Gas Ltd (Delhi), Mahanagar Gas Ltd (Mumbai), Gujarat Gas, Adani Gas
- Supply cuts affect millions of households with PNG cooking connections and CNG vehicles directly
Connection to this news: A 40% reduction in gas supply to CGD companies would directly affect millions of households relying on PNG for cooking and millions of vehicles using CNG — creating a consumer-facing energy crisis of immediate political significance.
India-Qatar Energy Relations
Qatar has been India's primary LNG supplier since India entered the LNG market in the early 2000s. The relationship is anchored by long-term SPAs between Petronet LNG and QatarEnergy (formerly RasGas) covering substantial volumes at agreed pricing formulas. India and Qatar also have broader bilateral ties — Qatar hosts a large Indian diaspora (over 800,000 Indian workers), and bilateral trade exceeds $15 billion annually. In addition to LNG, Qatar is a source of LPG and petrochemical products for India. The energy relationship has strategic dimensions — Qatar's position as a stable Gulf supplier was a key element of India's energy security architecture before the 2026 crisis.
- Petronet-QatarEnergy SPA: foundation of India's LNG supply security since early 2000s
- Qatar supplies approximately 40% of India's total LNG imports
- Indian diaspora in Qatar: over 800,000 workers — a key bilateral factor in diplomatic relations
- India-Qatar bilateral trade: approximately $15 billion annually
- Qatar also supplies LPG to India; the 2026 crisis affects both gas and LPG supply simultaneously
Connection to this news: The force majeure disruption represents not just a supply chain failure but a stress test of India's energy diplomacy — highlighting that a single-country LNG dependence (40% from one source) creates strategic vulnerability that requires accelerated diversification.
India's Natural Gas Sector Architecture
Natural gas in India is distributed through a national grid operated primarily by GAIL (Gas Authority of India Limited), with additional pipeline networks owned by state companies and private operators. Regasified LNG from terminals enters GAIL's Hazira-Vijaipur-Jagdishpur (HVJ) pipeline and other networks, reaching fertilizer plants (which use gas as feedstock), power plants, industrial users, and CGD companies. India's gas consumption is approximately 170-180 million standard cubic metres per day (MMSCMD), with imports accounting for roughly 45-50% of total supply.
- GAIL: primary gas transmission and marketing company; manages the national gas grid
- HVJ pipeline: backbone of India's national gas grid (Hazira, Gujarat to Jagdishpur, UP)
- India's gas consumption: approximately 170-180 MMSCMD
- LNG imports account for approximately 45-50% of India's total gas supply
- Major gas consumers: fertilizer plants (largest), power plants, industrial users, CGD companies
Connection to this news: A 40% cut in LNG supply to CGD companies — as indicated in post-force majeure reports — would require rationing across fertilizer, industrial, and household consumers, underscoring India's limited ability to quickly substitute imported LNG with domestic gas.
Key Facts & Data
- Petronet LNG: India's largest LNG importer; Dahej terminal capacity 17.5 MMTPA
- Qatar supplies approximately 40% of India's LNG imports
- Force majeure declared by both QatarEnergy (seller) and Petronet LNG (buyer-cum-seller to off-takers)
- Downstream impact: up to 40% cut in industrial and CGD gas supply in India
- Ras Laffan Industrial City: world's largest LNG export facility (Qatar, northeast coast)
- The 2026 disruption: vessels unable to safely transit Strait of Hormuz to reach Ras Laffan
- Indian diaspora in Qatar: over 800,000 — diplomatic and bilateral relationship factor
- India's gas consumption: approximately 170-180 MMSCMD; imports: approximately 45-50% of total
- PNGRB regulates CGD licensing; over 630 districts covered by CGD area licensing