Central Govt removes LNG allocation rules following Hormuz shipping revival

New Delhi, July 5 – In a notification dated today, the central government announced the cancellation of the core provisions of the emergency Natural Gas (Supply Regulation) Order, 2026. The move comes after the cease‑fire in West Asia and the reopening of the Hormuz Strait, which have collectively restored the flow of LNG cargoes to Indian ports.

The earlier order had enabled the government to allocate gas on the basis of a priority‑consumer list, effectively controlling the share of domestically produced gas and imported LNG each sector could receive. With the resumption of maritime traffic, those controls are considered redundant.

Energy officials noted that the renewed shipping activity has alleviated the supply crunch that prompted the emergency measures, which were initially imposed when US‑Israel‑Iran tensions forced several carriers to claim force‑majeure and reroute their shipments.

India’s energy strategy remains heavily import‑dependent, with roughly half of its natural‑gas demand met through overseas LNG, a majority of which travels via the Gulf corridor. The removal of the allocation rules is expected to bring greater flexibility to the market and support stable pricing for industry and consumers alike.