What Happened
- As the Iran-U.S.-Israel conflict escalated in early March 2026, analysts and industry sources warned that India — the world's second-largest LPG importer — faces the risk of an acute cooking gas shortage due to its overwhelming dependence on West Asian supplies.
- India imports over 90% of its LPG from West Asia, with the vast majority transiting through the Strait of Hormuz; any sustained disruption to shipping in the strait could severely limit India's monthly LPG intake.
- India's monthly LPG imports range from approximately 1.83 to 2.03 million tonnes; of this, between 1.66 and 1.78 million tonnes come from key Gulf suppliers — UAE, Qatar, Kuwait, and Saudi Arabia.
- India's three state-owned oil marketing companies (OMCs) — Indian Oil Corporation (IOC), Bharat Petroleum Corporation Limited (BPCL), and Hindustan Petroleum Corporation Limited (HPCL) — are the primary LPG importers and manage domestic distribution.
- Government sources indicated that India has approximately 6–8 weeks of crude oil coverage and is "comfortably placed" on LPG in the immediate term; however, if the Strait of Hormuz were disrupted, the supply shortfall would begin to manifest within 2–3 weeks.
Static Topic Bridges
India's LPG Import and Distribution System
India's domestic LPG supply relies heavily on imports because domestic production from refineries and gas fields falls far short of demand, particularly after the government's flagship Pradhan Mantri Ujjwala Yojana (PMUY) expanded access to over 100 million rural households since 2016.
- India is the world's second-largest LPG consumer and importer (after China); total LPG imports in 2025 were approximately 23.3 million tonnes.
- The three OMCs (IOC, BPCL, HPCL) import LPG, blend it at coastal terminals, and distribute it through a network of 6,000+ LPG bottling plants and approximately 10,000+ distributors across India.
- LPG imports under the Pradhan Mantri Ujjwala Yojana target BPL households; subsidies are managed through the Direct Benefit Transfer (DBT) system ("PAHAL" scheme) where subsidy is paid directly to consumers' bank accounts after purchase at market price.
- India's major LPG import terminals are at Kandla (Gujarat), Mangalore, Kochi, Haldia, and Vizag — all served by tankers from the Gulf.
- India aims to diversify LPG sourcing: the target is to reduce Middle East dependency to below 70% by 2030 and increase supply from the Americas (U.S./Canada) to 20–25%.
Connection to this news: The concentration of LPG sourcing from West Asia (90%+) and the routing through the Strait of Hormuz means that even a partial disruption of shipping in the strait — without Iran physically blocking it — could create supply delays large enough to cause shortages at the retail level within weeks.
The Strait of Hormuz — Global Oil Chokepoint and India's Exposure
The Strait of Hormuz is the world's most critical oil and gas transit chokepoint — a narrow waterway approximately 33 km wide at its narrowest point, separating Iran (to the north) from Oman and UAE (to the south).
- Approximately 17–20 million barrels of oil per day (20–25% of global oil consumption) transit the Strait daily.
- One-fifth of global LNG trade and approximately 80% of India's LPG imports pass through this single chokepoint.
- 88% of all oil leaving the Persian Gulf exits via the Strait of Hormuz; the only alternative — the East-West Pipeline in Saudi Arabia (capacity: 5 million bpd) — can bypass the strait for crude but not for LPG or LNG.
- Iran has repeatedly threatened to close the Strait as leverage; it has practiced naval exercises simulating a blockade (most recently in 2022 and 2024).
- A sustained closure of the Strait would send global oil prices past $100/barrel and trigger LPG supply emergencies across Asia (India, Pakistan, Bangladesh, Sri Lanka).
Connection to this news: India imports 80% of its LPG through the Strait of Hormuz. Even a week-long effective disruption to tanker traffic — from Iranian naval interdiction, mine laying, or air attack threats deterring commercial vessels — could begin depleting Indian LPG reserves within days of the disruption.
India's Energy Security Framework and Vulnerability
Energy security is defined as the uninterrupted availability of energy sources at an affordable price. India's energy security is structurally challenged by high import dependence for oil, gas, and LPG, with limited domestic reserves and refinery capacity for these hydrocarbons.
- India imports approximately 88% of its crude oil requirement; in FY2024–25, the import bill was approximately $132 billion.
- India's Strategic Petroleum Reserve (SPR) program currently has approximately 5.33 million tonnes of storage capacity at Visakhapatnam, Mangaluru, and Padur — sufficient for approximately 9–10 days of consumption.
- The International Energy Agency (IEA) recommends member countries maintain 90 days of oil reserves; India's SPR covers a fraction of this.
- Russia became India's largest crude oil supplier post-2022 (accounting for approximately 35–40% of crude imports by 2024), reducing West Asian crude exposure — but LPG supply cannot be easily rerouted from Russia due to logistical constraints.
- India's Hydrocarbon Exploration and Licensing Policy (HELP) and National Gas Grid are long-term domestic supply-side interventions, but do not address the immediate West Asian LPG dependency.
Connection to this news: India's limited strategic petroleum reserves and the absence of a strategic LPG reserve means there is a compressed time window between the onset of any Strait of Hormuz disruption and visible LPG shortages at the retail (consumer) level in Indian cities and villages.
Key Facts & Data
- India is the world's second-largest LPG importer; total 2025 LPG imports: approximately 23.3 million tonnes.
- Over 90% of India's LPG comes from West Asia; 80% transits through the Strait of Hormuz.
- Monthly LPG imports: 1.83–2.03 million tonnes; Gulf suppliers (UAE, Qatar, Kuwait, Saudi Arabia) account for 1.66–1.78 million tonnes/month.
- Importers: IOC, BPCL, HPCL (state-owned oil marketing companies).
- India's buffer: 6–8 weeks of crude oil coverage; 2–3 weeks of LNG reserves (as of early March 2026).
- PMUY (Pradhan Mantri Ujjwala Yojana) extended LPG access to 100+ million BPL households since 2016.
- Strait of Hormuz: 17–20 million barrels/day of oil transit; India's single most critical energy transit point.
- India's Strategic Petroleum Reserve capacity: ~5.33 million tonnes (9–10 days of consumption) at Visakhapatnam, Mangaluru, and Padur.
- India's LPG diversification target: reduce Middle East share to below 70% by 2030, increase Americas share to 20–25%.