US gas exports are set to gain from a recent commitment made by Donald Trump and Narendra Modi to make India a major buyer of American energy. Analysts note that India, being one of the fastest-growing large economies, is increasing its consumption of fossil fuels significantly.
During their first meeting since Trump took office, both leaders agreed to boost American oil and gas exports in a bid to improve their trade relationship. Currently, India mainly relies on Russia for crude oil, while Qatar remains its top source of liquefied natural gas (LNG).
As the leading LNG exporter globally, the US has already provided about 20% of India’s gas supplies in 2024. Experts believe that the new commitment from the leaders, especially following Trump’s earlier comments criticizing India’s tariffs, could open up the market further for US energy suppliers.
Rajeev Lala, a director at S&P Global, stated, “Gas is where the real opportunity lies. India remains one of the last large untapped gas markets worldwide.”
With US gas export prices currently more favorable, Arvinder Singh Sahney from the Indian Oil Corporation expressed readiness to increase natural gas imports. The International Energy Agency’s latest report highlighted that India’s gas consumption is predicted to rise by nearly 60% by 2030, with LNG imports expected to more than double as demand grows and domestic production lags.
In 2023, Indian production met only about half of the total demand. Energy and Gas Minister Hardeep Singh Puri emphasized that there is substantial potential for India to buy more energy globally, aiming to raise natural gas’s share in its energy mix from 6% to 15% by 2030.
Indian companies are also forging supply deals as far away as Argentina, and Puri noted that India is currently spending around $20 billion on US energy. Increasing these purchases could significantly impact the $35 billion trade surplus the US has with India.
Kevin Book from ClearView Energy Partners remarked that energy imports from the US could fulfill the need for economic balance. Since the onset of the Ukraine conflict, India has turned to cheaper Russian oil, which made up about a third of its imports last year, while the US supplied only a fraction in comparison.
Although supply from the US poses challenges such as longer shipping times and refinery adjustments, US LNG providers are eager for more trade, particularly with new terminal plans to increase capacity. Mike Sabel, CEO of Venture Global, confirmed their readiness to expand gas supplies to India post-launch of a new facility in Louisiana, reinforcing the commitment to fulfill growing energy demands.