NEW DELHI – India’s LPG imports plummeted by over 40% in March, creating a significant supply gap as the West Asia conflict chokes traditional maritime routes. Despite a strategic shift toward US and Iranian supplies, the shortfall has forced a major ramp-up in domestic production to maintain national fuel stocks.

Key Highlights of the Supply Crisis:

• Strait of Hormuz Disruption: Since the conflict began on February 28, traffic through the Strait—which handles a third of global LPG exports—has been severely restricted, slashing shipments from the UAE, Qatar, and Saudi Arabia.
• New Supply Leaders: In a major pivot, the United States emerged as India's top supplier in March (420,000 tonnes), while Iran resumed shipments for the first time in seven years to help plug the deficit.
• Domestic Production Surge: To counter the 46% drop from January levels, the Oil Ministry directed refiners to divert hydrocarbon streams toward LPG, resulting in a 40% increase in domestic output by mid-March.
• Price Outlook: Analysts warn that even if the situation stabilizes, the complexity of restoring logistics will likely keep international LPG prices elevated in the near to medium term.

With imports meeting roughly 60% of India's consumption, the government is now balancing refinery outputs to ensure that rising demand from the pharmaceutical and chemical sectors does not impact household supplies.