The rally follows the government’s issuance of the Natural Gas (Supply Regulation) Order, 2026, on March 9, aimed at prioritising gas allocation to essential sectors amid supply disruptions triggered by the ongoing conflict in the Middle East.
The order stated that liquefied natural gas shipments through the Strait of Hormuz have been disrupted due to the conflict, with suppliers invoking force majeure clauses and diverting supplies to priority sectors.
According to the government notification, natural gas supply will be prioritised for domestic piped natural gas consumers and compressed natural gas used in transport. Allocations will be maintained at 100% of the average consumption over the past six months, subject to operational availability.
The company said the government’s move would help safeguard essential energy supplies for households and the transport sector.
“The Company appreciates the Government’s prompt efforts in bringing out the said Order and according priority for the gas supplies to Domestic PNG and CNG customers, as well as supply of PNG to Industrial and Commercial Customers,” it said.
The company also added that some of its gas suppliers have curtailed supplies due to escalating geopolitical tensions in West Asia, affecting its ability to serve certain industrial customers.The city gas distributor noted that the disruption has reduced the availability of gas for industrial supply.
“We wish to inform that in view of the recent escalation of geopolitical developments in the Middle East region, some of the gas suppliers of the Company have curtailed the gas supply, which in turn has impacted our supplies to industrial customers,” the company said.
It added that it is currently assessing the impact and taking necessary steps to mitigate the effect, including coordinating with the relevant authorities.
The government order also directed all entities involved in the production, import, marketing, transportation, and supply of natural gas, including producers, LNG terminal operators and city gas distributors, to comply with revised supply schedules and sector-wise allocations coordinated through GAIL and the Petroleum Planning and Analysis Cell.
Due to supply constraints arising from the closure of the Strait of Hormuz, gas prices have risen in India. Domestic cooking gas prices have increased by Rs 60 per cylinder, while commercial LPG prices have gone up by Rs 114.5.
European natural gas prices also surged nearly 40% last week after Qatar Energy halted production at a key LNG facility amid escalating tensions in the Middle East.
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