The supply issues come after attacks on Iran and retaliatory strikes by Tehran that have disrupted shipping through the Strait of Hormuz – a narrow waterway between Iran and Oman that serves as one of the world’s most vital energy routes.
Rising tensions in the Middle East are starting to disrupt global energy supplies, with Indian companies now feeling the effects. Adani Total Gas has raised gas prices for industrial customers, citing supply challenges linked to the ongoing conflict in the region, according to a report by Reuters.
Industrial Customers Face Price Hike
Adani Total Gas has announced an increase in gas prices for industrial users who exceed their contracted daily consumption limit. According to a notice issued to customers, the revised rate is Rs 119 per standard cubic metre for any additional gas consumed beyond 40% of the daily contract quantity.
Previously, the price for these additional supplies was about Rs 40 per standard cubic metre, according to a source familiar with the matter. The company implemented the revised pricing starting Tuesday.
Energy Supply Issues Linked to Middle East Tensions
The company said the price increase is due to reduced availability of liquefied natural gas (LNG) caused by ongoing geopolitical tensions in the Middle East.
In a notice to customers, Adani Total Gas stated that it has received lower upstream gas supplies due to the disruption. “Due to recent geopolitical developments affecting LNG supply routes, ATGL has faced upstream gas curtailment, resulting in operational constraints,” the company said.
Energy Flows Hit by Disruption in Strait of Hormuz
The supply issues come after attacks on Iran and Tehran’s retaliatory strikes disrupted shipping in the Strait of Hormuz. The narrow passage between Iran and Oman is among the world’s most important energy routes, carrying a large share of global oil and gas shipments.
About one-fifth of the world’s oil supply passes through this route, along with significant quantities of liquefied natural gas (LNG). However, shipping activity has slowed considerably after reports that several vessels operating in the region were struck.
Partnership Between Adani and TotalEnergies
Adani Total Gas is a joint venture between the Adani Group and French energy giant TotalEnergies. The company provides piped natural gas (PNG) and compressed natural gas (CNG) to multiple cities across India.
The company did not immediately respond to requests for comment regarding the recent price hike.