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India asks Qatar for reduced LNG rates

India has asked its largest LNG supplier Qatar to lower the price of LNG under its current long-term contracts. However, the latter has refused, arguing that maintaining the sanctity of the agreements is crucial to both sides. India currently imports 8.5 million tonnes per annum of LNG from Qatar under two long-term contracts with rates linked to crude oil prices. Currently, landing price of LNG is at around US$ 9-10 per million British thermal unit, but the same gas is now available in the spot or current market at half the rate. India’s long-term contract with Qatar is currently the most expensive compared to competitors like Australia, Russia, and US. Oil Minister Shri Dharmendra Pradhan met Qatar Energy Minister Saad Sherida al-Kaabi to press for the “need for realignment of existing long-term LNG contracts with the market to suit the affordability of end consumers”. Kaabi responded that while current contracts cannot be renegotiated, it was willing to supply additional volumes at different rates.