LPG: Government Directs IOCL, HPCL and BPCL to Follow New Import Rules
India is preparing to secure more LPG supplies from the United States as it looks to reduce its dependence on Middle Eastern producers. The government has directed Indian Oil, Bharat Petroleum and Hindustan Petroleum to source at least 15% of their total LPG imports through long-term US contracts until 2027.
Earlier this year, India signed its first long-term LPG deal with the US for around 2.2 million tonnes, equivalent to nearly 10% of the country's total LPG imports. Senior officials from the three state-run oil companies are now in the US negotiating additional supply agreements.
The United States has now emerged as India's leading LPG supplier, with shipments reaching a record 3.9 million tonnes by August. After assessing offers from potential suppliers, the three oil companies are expected to float a joint tender for US LPG.
The US administration has been pushing India to buy more American energy, given the country's huge dependence on imported oil and gas. Despite prolonged discussions, a broader trade agreement has yet to reach a final outcome.
The shortage is also prompting some households and industries to explore alternatives such as PNG, biofuels and kerosene. A wider mix of suppliers could therefore help India strengthen energy security and reduce the impact of future disruptions.
Leh has among the highest prices, with a domestic cylinder costing Rs 1,119 and a commercial cylinder Rs 3,376.
In Ranchi, a domestic cylinder costs Rs 999.50 and a commercial cylinder Rs 2,922. This makes the domestic cylinder Rs 57.50 and the commercial cylinder Rs 184 costlier than in Delhi.
For consumers, the immediate focus remains LPG availability and prices. In the longer term, India's push for US supplies is aimed at creating a more diversified and resilient LPG supply chain.
Earlier this year, India signed its first long-term LPG deal with the US for around 2.2 million tonnes, equivalent to nearly 10% of the country's total LPG imports. Senior officials from the three state-run oil companies are now in the US negotiating additional supply agreements.
Why India Is Looking Beyond The Middle East
For years, Gulf countries supplied more than 90% of India's LPG needs. However, tensions involving Iran and disruptions around the Strait of Hormuz have exposed the risks of depending heavily on one region.The United States has now emerged as India's leading LPG supplier, with shipments reaching a record 3.9 million tonnes by August. After assessing offers from potential suppliers, the three oil companies are expected to float a joint tender for US LPG.
LPG Supply Is Also Linked To India US Trade Talks
The move could serve another purpose: helping India narrow its trade surplus with the US. Energy purchases have become an important part of the ongoing India-US trade negotiations.You may also like
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The US administration has been pushing India to buy more American energy, given the country's huge dependence on imported oil and gas. Despite prolonged discussions, a broader trade agreement has yet to reach a final outcome.
LPG Shortage Hits Consumption
The supply disruption has already affected LPG availability in India. LPG consumption fell by more than 16% year-on-year last month to around 2.35 million tonnes.The shortage is also prompting some households and industries to explore alternatives such as PNG, biofuels and kerosene. A wider mix of suppliers could therefore help India strengthen energy security and reduce the impact of future disruptions.
LPG Cylinder Prices On August 14
LPG prices vary significantly across cities. In Delhi, a 14.2 kg domestic cylinder costs Rs 942, while a 19 kg commercial cylinder is priced at Rs 2,738.Leh has among the highest prices, with a domestic cylinder costing Rs 1,119 and a commercial cylinder Rs 3,376.
In Ranchi, a domestic cylinder costs Rs 999.50 and a commercial cylinder Rs 2,922. This makes the domestic cylinder Rs 57.50 and the commercial cylinder Rs 184 costlier than in Delhi.
For consumers, the immediate focus remains LPG availability and prices. In the longer term, India's push for US supplies is aimed at creating a more diversified and resilient LPG supply chain.
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