India's LPG Imports From US Set to Exceed 1 Million Tonnes in June
India is set to import a record 1 million metric tons of LPG from the US in June. This move follows supply disruptions in the Middle East, with India now diversifying its energy sources to ensure uninterrupted domestic cooking gas supplies.
Highlights
- •India's LPG imports from the US are expected to exceed 1 million metric tons in June.
- •The shift follows supply chain disruptions in the Middle East, specifically the closure of the Strait of Hormuz.
- •Indian refiners are prioritizing domestic supply by maximizing local output and scaling piped gas connections.
- •Regional supply from the UAE and Kuwait is beginning to recover, diversifying the national energy portfolio.
India is poised to reach a significant milestone in its energy sector as LPG imports from the United States are projected to surpass 1 million metric tons this June. This record-breaking volume highlights a strategic shift in the nation's energy procurement as it seeks to stabilize domestic supplies amidst persistent disruptions in the Middle East.
Historically, India relied heavily on Middle Eastern producers, sourcing approximately 90% of its monthly LPG imports—totaling about 2 million tons—from the region. However, the closure of the Strait of Hormuz, exacerbated by regional tensions, drastically impacted these established supply chains. Data indicates that imports plummeted to roughly 696,000 tons in April before staging a recovery to 1.15 million tons in May as supply strategies were rapidly adjusted.
Shifting Energy Strategies and Market Reliance
Before these geopolitical complications emerged, New Delhi had initiated a plan to diversify its trade partners, aiming to increase U.S. LPG purchases to account for 10% of total imports. The sudden closure of critical waterways forced the country to accelerate this transition. Indian refiners have since engaged in aggressive spot buying, paying notable premiums to secure energy resources and ensure that domestic cooking gas supplies remain consistent for citizens.
To mitigate the impact of supply constraints and rising costs, the government has implemented several proactive measures. Refiners have been instructed to maximize LPG production locally, while distribution has been prioritized for households alongside a swift expansion of piped gas infrastructure. Reports suggest these efforts have already contributed to a 15% to 20% reduction in overall national LPG consumption.
Current Supply Trends and Future Outlook
Current preliminary data for June reveals a diversified intake of fuel. While U.S. imports are set to reach between 1.1 million and 1.2 million tons, supplies from the United Arab Emirates are also showing signs of recovery, with an expected volume of 300,000 to 400,000 tons. Abu Dhabi National Oil Co has notably deployed multiple vessels to manage these logistics via Oman's Sohar port. Furthermore, additional shipments are expected from Kuwait, Iran, Saudi Arabia, Algeria, Qatar, and Nigeria.
Industry experts anticipate that a partial reopening of the Strait of Hormuz will bolster supply reliability from the Middle East in the coming months. Such a development is expected to alleviate pressure on spot markets and eventually lead to a stabilization or reduction in international LPG prices for the Indian market.
