The Indian government has restored liquefied petroleum gas (LPG) supplies to commercial consumers—including hotels and businesses—to levels seen before the West Asia crisis, lifting sector-specific restrictions imposed during the conflict. Additionally, bulk LPG supply, which had been suspended, has been relaxed to 50% of pre-crisis consumption, offering significant relief to commercial and industrial users.
Policy Adjustments Amid Improved Supply
The restoration follows an improvement in the LPG supply situation. During the crisis, the government invoked the Essential Commodities Act to mandate that C3 (propane) and C4 (butane) streams be used exclusively for LPG production, diverting them from petrochemical and other downstream uses. Now, with domestic LPG production rising and imported supplies projected to be available, the government has decided to reduce this diversion. Enhanced allocation of C3/C4 streams for non-LPG uses will proceed while ensuring domestic LPG availability remains unaffected and indigenous production stays at no less than 40 TMT per day.
The Centre for High Technology, under the Petroleum Ministry, has been directed to issue organisation-wise allocations of the enhanced C3/C4 streams for petrochemical and other critical sectors and to submit regular reports.
Impact of West Asia Crisis on LPG Supply
West Asia accounts for 90% of India's cooking gas imports. Amid global supply disruptions from the crisis, the government prioritised uninterrupted LPG for domestic consumers, imposing temporary restrictions on commercial packed LPG. Timely policy interventions and coordinated efforts by oil marketing companies (OMCs) helped maintain stable supplies despite challenging global supply chains.
The government has directed OMCs to continue maintaining comprehensive data on commercial and industrial LPG consumers to facilitate efficient planning and supply management. A unified sectoral database will also be maintained across OMCs for better monitoring and operational coordination.
Transition to Piped Natural Gas
The government remains committed to expanding piped natural gas (PNG) connectivity. Commercial and bulk consumers who have already shifted to PNG will continue using it. Eligible LPG consumers with access to piped gas, or those in the process of shifting, will be progressively transitioned to the PNG network.
