What the lifting of gas curbs means? | Explained
The Ministry of Petroleum and Natural Gas withdrew most provisions of the emergency Natural Gas (Supply Regulation) Order, 2026
The order had been imposed after LNG shipments through the Strait of Hormuz were disrupted amid conflict in West Asia
Withdrawal followed the resumption of normal LNG shipping traffic through the Strait of Hormuz after a ceasefire took hold in the region
Sectors that had faced supply curtailment during the emergency period — notably petrochemical plants and power stations — are among those expected to see restored gas availability
The order's removal restores the standard, non-emergency framework for allocating domestically produced and imported natural gas
The Strait of Hormuz as a Global Energy Chokepoint
The Strait of Hormuz, the narrow channel between Iran and Oman connecting the Persian Gulf to the Arabian Sea, is the world's most critical oil and gas transit chokepoint. Roughly one-fifth of global LNG trade and a much larger share of seaborne crude oil transits this route, making any disruption there a direct threat to energy-importing economies, including India.
Key Details
- More than half of India's LNG imports transit the Strait of Hormuz, with Qatar as a major supplying source
- India ranks among the countries most exposed to Hormuz disruptions, alongside Japan and South Korea
- India's total natural gas consumption is approximately 189 MMSCMD (million metric standard cubic metres per day), of which about 97.5 MMSCMD is met from domestic production — the remainder relies on imports, much of it transiting Hormuz
The 2026 emergency order was a direct policy response to a Hormuz-linked supply shock; its withdrawal signals that the immediate transit risk has eased, restoring the pre-crisis import flow.
Administered Price Mechanism (APM) Gas and Priority Allocation
APM gas refers to domestically produced natural gas allocated by the government at a regulated, capped price to designated priority sectors rather than sold at market rates. This mechanism underlies the city gas distribution (CGD) business model, under which piped natural gas (PNG) for households and compressed natural gas (CNG) for transport are supplied at more affordable rates than they would command in an open market.
Key Details
- During the 2026 emergency, a priority-based allocation hierarchy was applied: PNG households, CNG for transport, LPG production, and pipeline operations were guaranteed 100% of their average consumption over the preceding six months
- Fertiliser plants were assured 70% of their average requirement
- Industrial consumers connected to the national gas grid and CGD networks were guaranteed 80% of average consumption, subject to availability
- Petrochemical plants and power stations were the first to face curtailment when supply had to be rationed
The order being withdrawn was precisely the instrument that had imposed this sectoral hierarchy — its removal means gas allocation reverts to standard commercial and regulatory arrangements rather than the emergency priority queue.
PNGRB and the Regulatory Architecture of India's Downstream Gas Sector
The Petroleum and Natural Gas Regulatory Board (PNGRB), established under the PNGRB Act, 2006, regulates the downstream natural gas and petroleum sector in India, including authorising city gas distribution networks and recommending pricing and allocation frameworks. A PNGRB-constituted expert committee has separately examined whether CNG (transport) should retain guaranteed priority access to APM gas even outside emergency conditions, given its role in affordable public mobility and urban air quality.
Key Details
- PNGRB licenses and regulates CGD entities that supply PNG and CNG in cities across India
- A High-Level Expert Committee (constituted 2024) recommended restoring priority APM gas allocation to the CNG transport segment during any future supply shortfalls
- The committee also recommended that allocation cuts, when necessary, be spread evenly across sectors rather than concentrated on CNG
The 2026 emergency order and its withdrawal sit within this same regulatory ecosystem — the debate over how strictly to prioritise CNG and household PNG during shortages predates the Hormuz disruption and continues to shape gas-sector policy independent of the emergency order.
- Natural Gas (Supply Regulation) Order, 2026 issued by the Ministry of Petroleum and Natural Gas amid Strait of Hormuz-linked LNG supply disruption
- Priority allocation during the emergency: 100% (PNG households, CNG transport, LPG production, pipeline operations); 70% (fertiliser plants); 80% (industrial/CGD-connected consumers)
- First sectors curtailed under shortage: petrochemical plants and power stations
- More than 50% of India's LNG imports transit the Strait of Hormuz
- India's natural gas consumption: ~189 MMSCMD; domestic production: ~97.5 MMSCMD
- PNGRB established under the PNGRB Act, 2006, regulates India's downstream gas sector