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How GAIL will benefit from surge in spot LNG prices

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How GAIL will benefit from surge in spot LNG prices

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GAIL shares are in focus on the back of a surge in the LNG bid prices. GAIL buys LNG at a contracted price from the international market and sells it at the spot prices in Asian markets or the domestic markets.

GAIL shares are in focus on the back of a surge in the LNG bid prices. GAIL buys LNG at a contracted price from the international market and sells it at the spot prices in Asian markets or the domestic markets.
While the domestic prices or the Asian prices have gone up, the buying price is still constant at the $7 per mmbtu mark.
ICICI Securities, in its note, has said that spot LNG prices have surged 8 times from the May 2020 levels and are at the highest levels since May 2014.
Therefore, the surge in oil and spot LNG prices is extremely positive for GAIL as the purchase price is still very subdued which leaves the spread for the company higher.
CNBC-TV18’s Sonal Bhutra has more details.
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