LPG Production Increased By 10% As Government Says Crude Oil Supply Position Is Stable

India has increased domestic production of liquefied petroleum gas (LPG) by about 10% following government directions aimed at strengthening fuel availability amid global energy disruptions, according to a government source cited on March 10.

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The move comes as authorities seek to maintain stable domestic energy supplies during the ongoing geopolitical tensions in West Asia that affected global fuel shipments in recent weeks.

According to the source, LPG distribution currently stands at about 60 lakh cylinders per day, which remains unchanged from earlier levels. The official also stated that no LPG distributor in the country is currently facing supply shortages.

Energy supplies that were previously disrupted due to the closure of the Strait of Hormuz have now been restored, the source added.

Government Forms Committee To Manage LPG Supply

The government has also set up a committee to manage LPG distribution among commercial users.

According to the source, oil marketing companies will engage with commercial consumers such as restaurants and other businesses to prioritise gas supplies based on operational requirements.

The committee will review demand from commercial users and allocate LPG supply accordingly. Essential sectors including hospitals and educational institutions will continue to receive priority supply.

In a joint statement, Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation said the government has initiated steps to increase LPG output and ensure adequate fuel availability for domestic consumers and essential sectors.

Imports And Fuel Shipments Improve

The government source also said that India is receiving additional shipments of LPG and liquefied natural gas from international suppliers.

Earlier supply constraints caused by tanker shortages have begun to ease. According to the source, there had previously been a shortage of about 40 very large crude carriers (VLCCs), and roughly half of those vessels have now resumed operations.

India has also increased fuel imports from regions outside the Strait of Hormuz.

According to the source, about 70% of India’s crude oil imports are now coming from non-Hormuz sources, compared with about 55% ten days earlier.

Government Reviews Energy Supply Situation

Prime Minister Narendra Modi held a meeting on Tuesday with Petroleum Minister Hardeep Singh Puri and External Affairs Minister S. Jaishankar to review LPG supplies and assess possible disruptions linked to the ongoing conflict involving Iran.

Amid concerns over global energy supply disruptions, the government also invoked provisions under the Essential Commodities Act to safeguard domestic fuel availability.

India's consumption of LPG amounts to 31.3 million tonnes every year. Of this total demand, 87% is met by the domestic sector, while the rest is consumed by commercial establishments such as hotels and restaurants.

Approximately 62% of India’s LPG requirement is met through imports. Earlier disruptions in the Strait of Hormuz affected shipments from major suppliers such as Saudi Arabia.

According to the government source, the country’s crude oil supply position currently remains stable and continues to improve as additional imports and shipments reach domestic markets.