Soaring Natural Gas Prices

Soaring Natural Gas Prices

In the midst of the current global energy crisis, natural gas prices in Europe and Asia have hit record highs.

  • Factors responsible for price rise: recovery of energy demand, return of businesses to pre-COVID levels, supply crunch due to fall in overall natural gas production, limited exports by major producers creating geopolitical doubts, etc.
  • India is also dependent on import of natural gas due to its use in manufacturing, transportation etc. of nitrogen-based fertilizers etc. It is known that about 37 percent of natural gas is imported into India. Therefore, India can also be affected by the current situation.
  • Natural gas is a non-renewable hydrocarbon gas. It consists mainly of methane (CH4) as well as a mixture of other gases, such as ethane, propane and butane. Natural gas is produced by the decomposition of plants and animals in organic form buried in the layers of sedimentary rocks for millions of years.

Benefits of natural gas:

  • It is available in abundance and can remain available for about 230 years depending on the level of consumption at present.
  • It emits about half of the CO2 produced by the combustion of coal and only one-tenth of the air pollutants.
  • Natural gas is increasingly being used for other applications as well. For example the use of liquefied natural gas (LNG) which is less emitting than diesel.

Natural Gas reserves in India:

India’s natural gas reserves stood at 47.31 trillion cubic feet in the year 2020, including 26 inland and offshore sedimentary basins.

Source – The Hindu

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