India Drastically Shifts LPG Sourcing to U.S. Amid West Asian Supply Risks
Petroleum Minister Hardeep Singh Puri revealed that the United States now provides 67% of India's LPG imports. This dramatic increase marks a strategic departure from the nation's previous heavy reliance on Gulf region supply routes.
Key takeaways
- The United States has become India's dominant LPG supplier, accounting for 67% of total imports.
- India previously relied on the Strait of Hormuz for 90% of its imported bottled hydrocarbon gas.
- Domestic oil marketing companies increased daily LPG production by over 60% to 55,000 metric tonnes during recent supply crises.
- The Indian government currently has no plans to levy new charges on LPG or natural gas for fuel reserve funding.
Energy Import Diversification
India has undergone a significant transformation in its energy procurement strategy, with the United States now supplying approximately 67% of the country's imported liquefied petroleum gas (LPG). During his address at the CII International Energy Conference, Petroleum and Natural Gas Minister Hardeep Singh Puri noted that this figure far exceeds initial expectations. The government originally aimed to source just 10% of its LPG needs from American suppliers to mitigate risks associated with regional instability.
Strategic Shift from the Gulf
Prior to the outbreak of conflict in West Asia, India obtained nearly 60% of its total LPG requirements from overseas. Approximately 90% of those volumes were transported through the Strait of Hormuz, a critical maritime chokepoint. Minister Puri recalled earlier skepticism regarding the necessity of U.S. imports given the proximity of Gulf suppliers, yet the current data validates the diversification policy as a buffer against geopolitical volatility.
Key Facts
- U.S. Market Share: American imports now constitute 67% of India's total LPG import basket.
- Production Surge: Indian oil marketing companies (OMCs) increased their daily LPG output from 34,000 metric tonnes to 55,000 metric tonnes during the height of the energy crisis.
- Historical Reliance: Before the West Asian conflict, 90% of India's imported bottled gas passed through the Strait of Hormuz.
- Levy Clarification: Minister Puri denied knowledge of any official proposal to tax LPG or natural gas to finance a strategic fuel reserve.
Domestic Production and Policy
To insulate the domestic market from import disruptions, state-owned oil marketing companies successfully scaled their internal production capacities. Daily output rose by 21,000 metric tonnes, reaching a peak of 55,000 metric tonnes. Regarding recent speculation about new fiscal measures, Minister Puri clarified that there is currently no plan to impose additional charges on natural gas or LPG consumers to fund national strategic reserves.
Source: The Hindu — National
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