Government Lifts Restrictions on Non-Domestic LPG Supply Amid West Asia Crisis
Significant Relief for Industrial and Commercial LPG Customers
In a move to provide substantial relief to industrial and commercial LPG users, the central government announced on Thursday the removal of all sector-specific restrictions on non-domestic packed LPG supply. This decision restores supply levels to those seen before the West Asia crisis. Additionally, the government has eased restrictions on bulk LPG supply, allowing it to reach 50% of pre-crisis consumption levels, greatly benefiting commercial and industrial clients.
Government Measures During the Crisis
The Ministry of Petroleum and Natural Gas stated that during the West Asia crisis, it had issued orders under the Essential Commodities Act. These directives mandated that C3-C4 streams be utilized solely for LPG production, diverting them from petrochemical and other downstream applications to enhance LPG output. Considering the improved production of LPG in the country and the anticipated availability of imported LPG cargo, the government has decided to reduce the diversion of C3/C4 streams from the LPG pool.
Maintaining Domestic LPG Availability
The ministry further clarified that the increased allocation of C3-C4 streams for non-LPG uses will be implemented in a manner that does not affect the availability of domestic LPG. The total production of LPG in the country is expected to maintain a minimum of 40 thousand metric tons (TMT) daily. During the West Asia crisis, the government had enforced provisions under the Essential Commodities Act, directing that C3-C4 hydrocarbon streams be exclusively used for LPG production to ensure sufficient domestic availability.
Future Allocations and Supply Improvements
With the supply situation improving, the government has now decided to reduce the diversion of C3-C4 streams for the LPG pool and increase their allocation for petrochemical and other critical sectors. According to the ministry, this increased allocation for non-LPG uses will be executed without impacting domestic LPG availability, ensuring that the country’s LPG production remains at least 40 TMT per day.