India Faces LPG Supply Shortage Despite Increased Imports from US and Iran

Original: West Asia crisis: LPG imports run out of gas despite increase in supplies from US, Iran

The Economic Times•Apr 3, 20262 min

In a Nutshell

India's liquefied petroleum gas (LPG) imports fell by over 40% in March compared to previous months, creating a significant supply gap. Although the US became the largest supplier and Iran resumed shipments, domestic production increases have not fully compensated for the shortfall caused by disruptions in the Strait of Hormuz due to ongoing conflicts.

Key Points

01India's LPG imports dropped to approximately 1.22 million tonnes in March.
02Imports from the US increased by 30% from February, making it the largest supplier.
03Iran resumed LPG shipments after a seven-year hiatus, supplying 43,000 tonnes.
04Supplies from traditional suppliers like the UAE and Saudi Arabia fell to 55% of their January levels.
05Domestic production increase of 40% in March could not fully offset the supply deficit.

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Full Summary

India's liquefied petroleum gas (LPG) imports in March saw a dramatic decline of over 40%, totaling around 1.22 million tonnes, compared to the previous two months. This significant drop is attributed to ongoing conflicts affecting maritime traffic through the Strait of Hormuz, a critical route for global LPG exports. Despite the turmoil, the US emerged as India's largest LPG supplier in March, providing 420,000 tonnes, a 30% increase from February. Iran resumed its LPG shipments after a nearly seven-year gap, contributing 43,000 tonnes. Traditional suppliers like the UAE, Qatar, Kuwait, and Saudi Arabia shipped only 672,000 tonnes, about 55% of India's total arrivals, marking a sharp decline from previous months. The Indian government has been adjusting domestic production to meet rising demand, but a 40% increase in production by mid-March was insufficient to close the supply gap. Analysts warn that even if conditions stabilize, restoring supply chains will take time, likely keeping LPG prices elevated in the near to medium term.

Key Figures

1.22 million tonnes

Total LPG imports in March

40%

Drop in imports compared to previous months

420,000 tonnes

LPG supplied by the US in March

43,000 tonnes

LPG supplied by Iran in March

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Why It Matters

The significant drop in LPG imports could lead to increased prices and potential shortages for consumers in India, as the country relies on imports for about 60% of its LPG consumption.

Who is affected

households and businesses relying on LPG for cooking and heating

What to know

Consumers should prepare for potential price increases and consider alternative energy sources if shortages persist.

FAQ

The drop was primarily due to disruptions in maritime traffic through the Strait of Hormuz caused by ongoing conflicts.

The US became the largest supplier in March, while Iran resumed shipments after a seven-year hiatus.

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