India's LPG Imports Plummet Amid West Asia Conflict

In March, India faced a significant drop in LPG imports, falling 46% from January levels due to disruptions in the Strait of Hormuz amid ongoing conflicts in West Asia. Traditional suppliers like the UAE and Saudi Arabia reduced shipments drastically, while the US and Iran stepped in to fill some of the gaps. Domestic production was ramped up to address the shortfall, but experts warn that high international prices are likely to persist. This situation highlights India's vulnerability to geopolitical developments affecting its energy imports.

By Narendra Chaudhary Apr 3, 2026, 14:34 IST

Significant Decline in LPG Imports

In March, India experienced a dramatic decrease in LPG imports, resulting in a substantial supply deficit. This drop occurred despite assistance from the US and Iran, who stepped in to mitigate some of the shortages caused by the ongoing conflict in West Asia. Ship-tracking data from Kpler indicates that India imported approximately 1.22 million tonnes of LPG in March, marking a staggering 46% decline from January and a 40% decrease compared to February. The decline is attributed to significant disruptions in the Strait of Hormuz, which have impacted maritime traffic since late February.

Reduction from Traditional Suppliers

India's primary LPG suppliers, including the UAE, Qatar, Kuwait, and Saudi Arabia, collectively delivered only 672,000 tonnes in March. This amount represents about 55% of total imports and is roughly 36-40% of what they provided in previous months. Notably, supplies from the UAE, typically India's largest source, plummeted to just 226,000 tonnes, which is less than one-third of January's figures.

US and Iran's Role in Filling the Gap

Interestingly, the two nations at the heart of the conflict contributed to alleviating some of the supply issues:

The United States emerged as India's largest LPG supplier in March, delivering 420,000 tonnes, a 30% increase from February.
Iran resumed its shipments after a hiatus of nearly seven years, providing 43,000 tonnes.

Additionally, smaller amounts were sourced from Argentina and Malaysia.

Boost in Domestic Production

With imports accounting for around 60% of India's total LPG requirements, the sharp decline resulted in a noticeable shortfall. To address this, the oil ministry instructed refiners to redirect more hydrocarbon streams towards LPG production. By mid-March, domestic output had increased by approximately 40%, alleviating some of the pressure. However, the government has begun to partially reverse this diversion as demand from the pharmaceutical, food processing, chemical, and petrochemical sectors is on the rise.

Future Price Projections

Experts predict that even if the situation in the Strait of Hormuz stabilizes, it will take time to restore normal supply chains. Consequently, international LPG prices are expected to remain high in the upcoming months. This scenario underscores the vulnerability of India's energy imports to developments in West Asia, even as alternative suppliers attempt to increase their contributions.