The country’s LPGimports plunged over 45% month-on-month to around 1.12 million tonne (MT) in March from nearly 2.04 MT in February, Kpler data showed. The drop came as the escalating West Asia conflict choked supply routes through the Strait of Hormuz, a critical artery that carries nearly 90% of the country’s LPG imports.
The sharp contraction is seen as a direct fallout of the geopolitical crisis, which has effectively disrupted shipping lanes, stranded vessels and triggered what officials describe as one of the worst gas supply shocks in recent years.
Ship-tracking and government data show the scale of disruption. At least 18 India-flagged vessels carrying LPG, crude and LNG remain stranded in the Persian Gulf, while additional foreign-flagged ships bound for India have also been held up due to the conflict.
Even as some tankers have begun moving under coordinated clearances, the flow remains severely constrained. Only a handful of LPG carriers have managed to transit the Strait, which has seen near-paralysis of maritime movement since the conflict escalated.
ALSO READIndia opens 80,228 sq km for oil and gas exploration; ONGC starts new gas output
The impact on imports has been immediate and severe.
From over 2.04 MT in February — when panic buying and precautionary stocking drove volumes to one of the highest levels—imports collapsed to around 1.12 MT in March. The country-wise import data reinforces the stress signals.
The UAE, India’s largest supplier, saw shipments fall from 625,000 tonne in February to about 226,000 tonne in March — around 64% drop. Qatar’s exports declined from 431,000 tonne to 226,000 tonne, while Saudi Arabia’s supplies fell from 341,000 tonne to about 154,000 tonne.
ALSO READSolar imports at 99 GW expose cell gap despite manufacturing surge
Similarly, shipments from Kuwait shrank from 228,000 tonne to just 67,000 tonne, reflecting the widespread impact of disrupted Gulf logistics.
The March data capture a complex market dynamic: imports have fallen sharply, but demand has not collapsed. Instead, it has shifted and remains unevenly distributed across sectors and regions.
The crisis has already begun to spill over into the domestic economy.
On the ground, shortages and disruptions are being reported across cities. Meanwhile, black marketing cases have surfaced, with enforcement agencies seizing cylinders amid allegations of supply manipulation.
Commercial consumption has also been hit, with authorities cutting supplies to industries to prioritise households, even as hotels and small businesses face operational disruptions.
“LPG imports contracted sharply in March, largely because a major share of India’s LPG import volumes was routed via the Strait of Hormuz. However, with India having started diversifying its sourcing base, April imports are expected to show a gradual improvement, indicating more stable inflows,” said Nikhil Dubey, senior refining analyst, Kpler.
The crisis has also triggered a global scramble for alternative supplies. Asian nations, including India, are increasingly turning to Russia and other non-West Asian sources as West Asia flows remain uncertain.
India has already begun diversifying its sourcing, tapping supplies from countries as far as Argentina and Africa, marking a significant shift in procurement strategy.
However, industry experts warn that diversification comes with logistical and cost challenges, including longer shipping routes and higher freight costs.
With over 33 million tonne of annual LPG consumption and heavy import dependence, India’s energy security remains tightly linked to developments in West Asia, making the current crisis a key stress test for its supply resilience.
Meanwhile, following the LPG control order issued by the Ministry of Petroleum and Natural Gas, domestic refinery production has been ramped up by 40%, bringing daily LPG output to 50 TMT (more than 60% of our requirement) against a total daily requirement of around 80 TMT. The net daily import requirement has consequently come down to only 30 TMT.
According to the ministry, over and above domestic production, 800 TMT of assured inbound LPG cargoes are already secured and en route from the US, Russia, Australia and other countries. |
