India directs refiners to boost LPG production after invoking emergency powers
TL;DR
India has invoked emergency powers to direct refiners to boost LPG production, prioritizing domestic supply over exports to mitigate risks from Middle East disruptions. This includes securing imports from the U.S. and ensuring state-owned companies handle distribution, amid rising prices and upcoming elections.
India directs refiners to boost LPG production after invoking emergency powers
India has directed oil refiners to increase liquefied petroleum gas (LPG) production by invoking emergency powers under the Essential Commodities Act of 1955, aiming to mitigate supply risks linked to the Middle East crisis. The government ordered public and private refiners to prioritize LPG output from propane and butane streams, ensuring these resources are not diverted to petrochemical production, such as polypropylene or alkylates according to reports. This measure affects major refiners, including Reliance Industries, which previously exported alkylates regularly as reported.
India imports approximately two-thirds of its LPG demand, with 85–90% of these supplies sourced from the Middle East, primarily through the Strait of Hormuz, which has faced disruptions due to conflict-related shipping restrictions and attacks on infrastructure according to analysis. To address vulnerabilities, the government mandated that LPG be supplied exclusively to state-owned marketing companies—Indian Oil Corp, Bharat Petroleum Corp, and Hindustan Petroleum Corp—for domestic household distribution as mandated. Violations of the order will face penalties as stated.
In parallel, India has secured a 2.2 million-tonne LPG import contract from the U.S. Gulf Coast, set to commence in 2026, diversifying its energy sources and reducing reliance on volatile regions according to reports. The move follows recent price hikes for domestic LPG and commercial cylinders by Rs60 and Rs114.5, respectively, reflecting rising energy costs as noted. With 33.1 crore active LPG consumers, the government aims to ensure uninterrupted supply ahead of state elections in April according to analysis. Natural gas supplies, critical for fertilizer and power sectors, are also being prioritized amid disruptions to Qatar’s liquefied natural gas exports as reported.
