Page 38 - Policy Economic Report - Jan 2026

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

Natural Gas Market

Natural Gas Price – Monthly Review

• Natural Gas spot prices at the US Henry Hub benchmark averaged $4.26 per million British thermal
units (MMBtu) in December 2025. Henry Hub's natural gas prices continued their strong
performance, increasing for a fourth consecutive month in December. Prices rose by ~12%, m-o-
m, on the back of a colder-than-average early winter, which boosted heating demand. According
to data from the US Energy Information Administration (EIA), average weekly natural gas storage
decreased by 10.5%, m-o-m, in December. Moreover, LNG export capacity utilization remained at
elevated levels in December, and this contributed to the price rally in the period. Prices were up
by ~41%, y-o-y.

• Natural gas spot price at the Title Transfer Facility (TTF) in the Netherlands in Europe traded at an
average of $9.48 per MMBtu. The average Title Transfer Facility (TTF) declined for a fifth
consecutive month in December, falling by 9.0%, m-o-m. Healthy storage levels offset pressure
from higher winter heating demand. According to data from Gas Infrastructure Europe, EU
storage levels fell to 63.2% as of the end of December, down from 75.4% the previous month,
representing a 12.2 percentage point decrease, m-o-m. Moreover, reports of increased US LNG
supply offset concerns regarding supply availability. Prices were down by 31.6%, y-o-y.

• Japan Liquefied Natural Gas Import Price averaged at $11.32 per MMBtu for December 2025.
There is a change of 1.5% from last month and -10.4% from one year ago.

• The Union Cabinet has approved a new formula for pricing of natural gas and imposed cap or
ceiling price on the same. Natural gas produced from legacy or old fields, known as APM gas, will
now be indexed to crude oil prices. From April 1 2023, APM gas will be priced at 10% of the price
of basket of crude oil that India imports. The rate such arrived at however will be capped at US$
6.50 per MMBTU. The price such arrived at will also have a floor of US$4 per MMBTU. As per
notification dated 31st March 2025, the APM gas price has been raised to US$ 6.75 per MMBTU,
up from US$ 6.50 per MMBTU.

• Further, in accordance with MoP&NG, Govt. of India, pricing freedom for gas being produced from
discoveries in Deepwater, Ultra Deepwater and High Pressure-High Temperature areas, the gas
price ceiling for the period 1st April, 2023 - 30th September, 2023 was notified as US$
12.12/MMBTU on Gross Calorific Value (GCV) basis as per notification dated 31st March, 2023. As
per notification dated 30th September 2023, Gas price ceiling was further revised for the period
1st October, 2023 – 31st March, 2024 was notified as US$9.96/MMBTU on Gross Calorific Value
(GCV) basis. Prices were further revised for the period 1st April, 2024 – 30th September, 2024 was
notified as US$9.87/MMBTU on Gross Calorific Value (GCV) basis as per notification dated 31st
March 2024. Accordingly, for the period 1st October, 2024 – 31st March, 2025 gas price ceiling
was further revised as US$10.16/MMBTU on Gross Calorific Value (GCV) basis as per notification
dated 30th September 2024. Now, as per notification dated 31st March 2025, Gas price ceiling

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