Page 44 - Policy Economic Report- June'26

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

June 2026 Natural Gas Market

Natural Gas Price – Monthly Review

• Natural Gas spot prices at the US Henry Hub benchmark averaged $2.94 per million British thermal
units (MMBtu) in May 2026. Henry Hub's natural gas prices rebounded in May after three
consecutive months of declines. They rose by 5.8%, m-o-m, on the back of higher LNG demand
amid supply disruptions from the Middle East. Moreover, seasonal maintenance at several export
terminals limited export capacity, adding upward pressure to prices. However, price gains were
limited by higher storage levels amid the injection season. According to data from the US Energy
Information Administration (EIA), average weekly underground storage rose by 16.2%, m-o-m.
Prices were down by ~5.8%, y-o-y.

• Natural gas spot price at the Title Transfer Facility (TTF) in the Netherlands in Europe traded at an
average of $16.17 per MMBtu. The average Title Transfer Facility (TTF) price increased by 4.9%,

m-o-m, in May. Prices rose on the back of a higher geopolitical risk premium amid continued
disruptions in the Middle East and competition for LNG cargoes from Asian markets. Moreover, gas
storage levels remained significantly below seasonal averages. According to data from Gas
Infrastructure Europe, EU storage levels rose to 40.1% as of the end of May, up from 32.5% the
previous month, but remained below the 50% threshold and were down 8 percentage points
compared with the same period last year. Softer residential demand amid mild weather conditions
partially mitigated price increases, which were up by ~38.6%, y-o-y.

• Japan Liquefied Natural Gas Import Price averaged at $15.77 per MMBtu for May 2026. There is
a change of 0.8% from last month and 28.0% 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, as per notification dated 31st March 2026, the APM gas
price has been raised to US$ 7.00 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

Page | 43