Centre Raises Commercial LPG Allocation To 70% Of Pre-Crisis Levels

The central government has increased commercial LPG allocation to 70% of pre-crisis levels by adding an additional 20% supply to existing quotas, aiming to support industrial demand, according to an official communication from the Ministry of Petroleum and Natural Gas.

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Oil Secretary Neeraj Mittal, in a letter to state chief secretaries, directed that the enhanced allocation be prioritised for key sectors, particularly labour-intensive industries, to ensure continuity in production and supply chains.

Higher Allocation For Industrial Demand

As per the communication, the allocation of packed non-domestic LPG has been increased from the earlier 50% to 70% of pre-crisis levels. The additional 20% supply is intended to address requirements of industries that rely on LPG as a fuel input.

The directive specifies that sectors such as steel, automobiles, textiles, dyes, chemicals, and plastics should be given priority in the distribution of the increased supply.

These industries are connected to broader manufacturing and supply chain activities. They are considered essential for supporting ongoing manufacturing activities.

Context Of Supply Adjustment

The allocation of LPG is being raised in response to supply chain disruptions resulting from the ongoing geopolitical tensions in West Asia.

Commercial-grade LPG is required by various industries for heating, processing, and manufacturing activities. The recent reduction in LPG supply has resulted in lower allocations for these industries.

The revised allocation is aimed at restoring supply levels closer to normal operations, based on pre-crisis consumption benchmarks.

Implementation Across States

The state governments have been asked to ensure that the allocation is effectively distributed to the eligible industries. The communication emphasises prioritisation of sectors that are labour-intensive and support essential downstream activities.

The allocation applies specifically to packed non-domestic LPG and is based on pre-crisis demand levels as a reference point.

The move is part of ongoing efforts by the government to manage energy supplies and support industrial activity amid changing global conditions, while ensuring that critical sectors continue to receive required fuel inputs.