REGULATORY · MARKET STRUCTURE · INDIA
India invokes ESMA to ration natural gas
Change
India invoked the Essential Commodities Act and notified the Natural Gas (Supply Regulation) Order, 2026 to ration natural gas and prioritise households, CNG vehicles, and LPG-producing units.
Why it matters
The Natural Gas (Supply Regulation) Order, 2026 was notified under the Essential Commodities Act (ESMA) of 1955. It establishes a four-tier priority framework for gas allocation with binding authority over existing gas sale agreements and commercial arrangements. Priority is assigned to households receiving piped gas, vehicles running on CNG, and units producing liquefied petroleum gas (LPG). Lower-priority recipients include petrochemical plants, power stations and oil refineries, which face curtailed deliveries. State-run oil marketing companies introduced a 25-day minimum interval between subsidised LPG refills, up from 21 days, and implemented a recent cooking gas price increase.
Implications
- • Existing gas sale agreements and commercial contracts are subordinate to the allocation framework.
- • Industrial gas consumers (petrochemical plants, power stations, oil refineries) face reduced natural gas deliveries.
- • Hotels and restaurants face constrained commercial LPG cylinder deliveries.
- • Subsidised household LPG refills are limited to a 25-day minimum interval.
Who is affected
- • Household piped-gas and LPG consumers
- • CNG vehicle operators and fleet managers
- • LPG producers and distributors
- • Industrial gas users (petrochemical plants, power stations, oil refineries)
Source
Topics
Law & Public Safety Regulatory Actions Energy & Power Oil & Gas