India’s liquefied natural gas (LNG) supply security is under scrutiny after tensions around the Strait of Hormuz triggered sharp price spikes and tightened Asian gas markets, according to a new analysis by S&P Global Energy.
The report by S&P Global Energy says Asia has emerged as the epicentre of the disruption, with more than 90 per cent of LNG shipments passing through the Strait of Hormuz in early 2026 destined for Asian buyers. Around 17 per cent of global LNG deliveries this year transit the strategic chokepoint via exporters such as Qatar and the UAE.
India is among the markets with significant exposure. In 2025, Qatar and the UAE accounted for about 59 per cent of India’s LNG supply and nearly 29 per cent of its total gas supply, making India vulnerable to disruptions to shipping routes through the Gulf.
The geopolitical shock has already triggered sharp price movements in global LNG markets. Platts JKM, the benchmark price assessment for spot liquefied natural gas (LNG) cargoes delivered to Northeast Asia, rose to $15.068 per million British thermal units (MMBtu) on March 2 — up 41 per cent from February 27 — before jumping 70 per cent in a single day to around $25/MMBtu on March 3, marking the largest daily surge since March 2022.
Replacement cargoes in focus
Analysts say Asian buyers are likely to be the most aggressive participants in spot LNG markets, seeking replacement cargoes if shipments from Qatar are disrupted.
Ross Wyeno, associate director for LNG short-term analysis at S&P Global Energy, said LNG volumes passing through the Strait of Hormuz could account for roughly 17 per cent of global supply in 2026, with a significant portion requiring replacement cargoes if disruptions persist.
The price spike is also raising the possibility of fuel switching in the power sector. Higher gas prices could increase demand for coal-fired generation across parts of Asia. However, analysts note that switching capacity is limited and that coal prices have risen only marginally so far.
For South Asian economies, including India, the report warns that prolonged price spikes could lead to demand curtailment, reflecting the region’s higher price sensitivity compared with wealthier LNG importers such as Japan or South Korea.
The duration of the conflict and its impact on maritime navigation remain the key variables determining how long LNG markets remain volatile, analysts said.>
