India’s liquefied petroleum gas (LPG) supply chain could take up to four years to fully stabilise, a senior government official has indicated, citing prolonged disruptions linked to geopolitical tensions in West Asia.
The concerns stem from instability triggered by the ongoing conflict involving Iran, which has affected critical supply routes and production capacities in the region.
Disruptions linked to Strait of Hormuz
A key factor behind the delay is the vulnerability of the Strait of Hormuz, through which nearly 90 per cent of India’s LPG imports are transported.
Officials noted that uncertainty around the route, combined with disruptions at supplier facilities, could significantly delay the restoration of normal supply levels. According to inputs from suppliers, recovery may take at least three years, and possibly longer depending on the extent of production shutdowns.
There is still limited clarity on whether certain gas wells have been exhausted or if production has temporarily halted, adding to the uncertainty.
Heavy reliance on imports
India depends on imports for around 60 per cent of its LPG consumption. The bulk of these imports come from Gulf countries such as United Arab Emirates, Qatar, and Saudi Arabia.
Recent disruptions have already impacted supply flows, with the share of these nations in India’s LPG imports declining to nearly 55 per cent. This reduction has tightened availability and increased pressure on domestic supply chains.
Prices rise amid supply crunch
The supply constraints have begun to reflect in retail prices. Domestic LPG cylinders have recently become costlier by ₹60, while commercial cylinders have seen an increase of ₹115.
The price rise is affecting households across the country, particularly in urban and semi-urban areas, and is also impacting small businesses and the hospitality sector that rely heavily on LPG.
Additionally, higher prices are expected to increase the government’s subsidy burden, adding fiscal pressure.
Push towards alternative fuels
In response to the ongoing challenges, the government is encouraging households to shift to Piped Natural Gas (PNG) wherever infrastructure is available.
PNG offers a more stable and potentially cost-effective alternative to LPG, as it is supplied through pipelines and is less dependent on imports. However, adoption remains limited.
As of early 2026, only about 1.6 crore households—roughly 12 to 13 per cent—have access to PNG, significantly below national targets.
Investment in infrastructure expansion
To accelerate adoption, the government is planning investments worth ₹5,000 crore to ₹6,000 crore to expand PNG infrastructure. The initiative may cover up to 50 per cent of pipeline costs, aiming to improve accessibility in urban and semi-urban regions.
Alongside PNG, authorities are also exploring alternative cooking solutions such as electric appliances, biogas, and emerging green hydrogen technologies to reduce long-term dependence on imported LPG.
Conclusion
India’s LPG supply outlook remains uncertain amid ongoing geopolitical tensions and infrastructure challenges. While recovery may take up to four years, the situation has highlighted the need for diversification of energy sources and faster expansion of domestic alternatives. The coming years will be crucial in determining how effectively India can reduce its reliance on imported fuel and ensure energy security for households.
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