LPG shortage: India urges PNG switch amid supply concerns

India is currently grappling with a significant shortage of Liquefied Petroleum Gas (LPG) cylinders, primarily driven by disruptions in global shipping routes through the Strait of Hormuz due to ongoing geopolitical tensions between the US, Israel, and Iran. This has led to a slowdown in maritime traffic, directly impacting India's substantial reliance on imports for its LPG needs, with approximately 60% of its requirement met through overseas sources, and 90% of these imports coming from the Middle East. The Indian government has taken several measures to mitigate the crisis. Notably, it has issued a directive urging households that possess both Piped Natural Gas (PNG) connections and domestic LPG subscriptions to surrender their LPG connections and refrain from obtaining refills or new cylinders. This measure aims to reduce the pressure on LPG demand, especially as approximately six million households have access to PNG infrastructure and can easily switch to this alternative fuel source. The government has also encouraged commercial establishments facing LPG supply disruptions to explore options with city gas distribution companies for PNG connections. To reassure the public and manage the supply chain, the government has confirmed that two Indian-flagged vessels, the 'Nanda Devi' and 'Shivalik', are en route to India, carrying a total of 92,700 metric tons of LPG. These ships are expected to arrive between March 16-17, bolstering domestic inventory. In parallel, authorities are actively combating panic buying and hoarding. Reports indicate a surge in daily LPG booking requests, with household bookings jumping significantly, despite government assurances of adequate stocks for domestic demand. Oil marketing companies (OMCs) have been instructed to launch campaigns promoting digital booking and consumer awareness to prevent unnecessary panic. The crisis has had a tangible impact on various sectors. The hospitality industry, in particular, has experienced considerable difficulties. Reports from Kerala indicate fears of a migrant exodus due to the LPG crisis affecting hotels. Similarly, BEST canteens and SAI centers have also reported issues with LPG supply. Commercial LPG cylinder distribution, which was briefly suspended, has resumed in limited quantities, with a priority list established for essential services like hospitals and educational institutions. Measures are also being implemented to regulate the distribution of commercial LPG in major cities, with a cap on daily availability in some instances. To further address the situation, India has asked refiners to boost LPG production, with domestic production reportedly increased by 30% since early March. The government has also considered emergency reintroduction of kerosene and coal as alternative fuels for cooking purposes for commercial users, and has asked Coal India to make coal available to the MSME and hospitality sectors. There has been a notable increase in LPG prices in March 2026, with a Rs 60 hike for a 14.2 kg cylinder in Delhi, making it the most significant increase in the past year. This price adjustment reflects the global energy market uncertainty and the disruptions in supply chains. Various news outlets, including The Times of India and The Hindu, have extensively covered the evolving situation, with The Hindu generally rated as factual but with a left-center bias, and The Times of India rated as mixed for factual reporting with a right-center bias. Mint, a business newspaper, is rated as least biased but mixed for factual reporting. The government is actively working to manage the situation by prioritizing domestic consumers, hospitals, and educational institutions, while also urging commercial users to explore alternatives. The ongoing efforts aim to stabilize the supply, curb panic, and ensure that essential services are not severely impacted by the global energy market disruptions.

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