India’s LPG supply chain is undergoing a sharp realignment, with imports falling to 265,000 metric tonne (MT) in the week (March 12 to March 19) from 322,000 MT on March 5. At the same time, the Gulf’s share in supplies dropped to 34% from nearly 100%, underscoring the growing impact of disruptions in the Strait of Hormuz.
The crisis has triggered a rapid shift in sourcing patterns. Alternative supplies surged to 176,000 MT from zero a week earlier, even as inflows from West Asia plunged to just 89,000 mt, reflecting a breakdown in traditional supply routes.
India, which relies on imports for nearly 60% of its LPG consumption, remains highly exposed to the disruption. The Strait of Hormuz accounts for about 90% of India’s LPG imports from the Gulf, making it a critical energy lifeline.
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Great Diversification
Globally, the shock is tightening market conditions. West Asia — which contributes roughly 30% of global LPG supply — has been partially sidelined, shrinking cargo availability and pushing buyers into an increasingly competitive scramble.
“Continued cooperation could support the passage of additional Indian-linked ships… keeping vital supply routes workable,” said Charles Kim of S&P Global Commodities at Sea, referring to ongoing diplomatic engagement.
India has already secured short-term relief through the arrival of two very large gas carriers (VLGCs) — Shivalik and Nanda Devi — which together delivered more than 92,000 MT of LPG, helping ease immediate supply pressure.
Meanwhile, the sourcing mix is undergoing a structural shift. India imported nearly 480,000 MT of US-origin LPG in January–February, equivalent to about 11 VLGC cargoes, and has also secured a 2.2 million metric tonne term deal for 2026, signalling a longer-term diversification away from Gulf dependence.
“India is increasingly turning to the US for LPG… North American LPG could gain a stronger foothold,” said Anmol Bhushan of S&P Global Energy CERA.
Prices are also reflecting tightening supply dynamics. West Asia propane and butane cargoes rose to $648/MT and $642/MT respectively, while CFR North Asia prices climbed more than 2.4% to $908/MT and $934/MT, indicating intensifying competition for available cargoes.
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Domestic Defense
On the domestic front, the government has stepped up supply-side measures to stabilise availability. LPG production at refineries has been ramped up by 40%, with domestic output currently meeting about 41% of total demand.
Sujata Sharma, joint secretary in the petroleum ministry, said ensuring supply continuity remains the top priority. “The situation is still worrying due to the war, but no dry out has been reported at our distributors… delivery of LPG cylinders is normal,” she said.
Demand-side pressures, however, remain elevated. Around 5.5 million refill bookings were recorded in a single day, although panic buying has begun to moderate. To ease the strain, about 7,500 consumers have shifted to PNG, while 13,700 new PNG connections have been added across key regions.
Commercial supplies are also being sustained, with 11,300 tonnes of LPG distributed over the past week and 18 states and Union territories issuing fresh allocation orders.
To curb irregularities, authorities carried out nearly 4,500 raids nationwide. Refill intervals have also been extended to 25 days in urban areas and up to 45 days in rural regions to ensure more equitable distribution.
Industry players are contributing as well, with Reliance Industries maximising LPG output at its Jamnagar complex to support domestic supply.
Despite these interventions, officials acknowledge that supply pressures persist in certain pockets. “LPG continues to be an area of concern… efforts are ongoing to stabilise the situation nationwide,” Sharma said.
With global LPG flows disrupted, cargo competition intensifying and logistics costs rising, India’s pivot towards diversified sourcing, higher domestic production and demand-management measures points to a broader structural reset in its cooking fuel supply chain amid prolonged geopolitical uncertainty.
TOPICSLPGThis article was first uploaded on March twenty, twenty twenty-six, at twenty-five minutes past nine in the night.