US dominates India’s LPG basket as war in West Asia reshapes energy flows | Today’s news

New Delhi: India is steadily increasing purchases of US cooking gas as the government steps up efforts to diversify imports after conflict in West Asia disrupted supplies and triggered emergency curbs on sales of the fuel.

The US became the biggest supplier of liquefied petroleum gas (LPG) to India in March, selling 435,081 tonnes, as the widening war in West Asia disrupted shipping through the key Strait of Hormuz and triggered an unprecedented global energy crisis.

Since then, Washington has remained New Delhi’s main supplier of LPG, with India often turning to spot purchases of US cargoes, which are more expensive than traditional West Asian supplies.

So far this month (as of June 19), the US has shipped over 497,000 tonnes of LPG, while the United Arab Emirates (UAE), which was India’s main supplier before the US-Iran war that began on February 28, sold nearly 90,000 tonnes, according to data from trade intelligence firm Kpler. Other key suppliers include Iran (73,073 tonnes), Saudi Arabia (53,218 tonnes) and Kuwait (22,554 tonnes).

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India imported 384,911 tonnes of LPG in April and about 629,500 tonnes in May from the US.

“The US has become a major supplier of LPG to India as Gulf flows have recently been disrupted. While this improves diversification, it may increase supply costs due to longer hauls,” said Sumit Ritolia, senior modeling manager, Kpler.

So far in the conflict, the US has been the main supplier with cumulative LPG exports since March of nearly 1.95 million tonnes, followed by the UAE with 613,041 tonnes and Saudi Arabia with 412,577 tonnes. India imported 4.10 million tonnes of LPG as of March 1, down 44% from around 7.41 million tonnes in the March-June period last year, according to Kpler, as the government took measures to curb demand.

It depends on the import

India meets about 65% of its annual LPG demand of 33 million tonnes through imports, spending nearly $11 billion. Before the conflict, India obtained approximately 90% of its LPG import volume from West Asia, so its supply chain was highly concentrated. Within months, however, he quickly turned to alternative suppliers. As a result, West Asian supplies to the world’s second largest importer of LPG fell to less than half of pre-war levels.

A Crisil report released on June 19 said the US has become one of the country’s largest LPG suppliers, accounting for nearly a third of imports in April 2026, compared to just 8% in February 2026. The shift was also made possible by a 2.2 million tonne per year LPG deal with India signed at the end of 2025, equivalent to roughly 1% of India’s imports at the end of 2020.

In addition, Iran re-entered India’s import basket, contributing 6% to imports in April. Indian buyers also source from Argentina, Chile, France and the Netherlands, further reducing dependence on traditional Gulf suppliers – the UAE, Saudi Arabia, Qatar and Kuwait.

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The Crisil report also noted that diversification has its own trade-offs, including higher cargo exposure and longer supply chains. According to data from the Petroleum Planning and Analysis Cell (PPAC) under the Union Ministry of Petroleum and Natural Gas, the LPG import bill during the first two months of this fiscal year (FY27) stood at $1.47 billion, compared to $1.96 billion a year ago.

As the war intensified, oil companies imposed restrictions on the sale of petroleum products according to government directives. LPG booking intervals have been extended to 45 days in rural areas and 25 days in urban markets, while diesel purchases at retail outlets have been capped at 200 liters per day per consumer.

Kirit Parikh, former member (energy) in the erstwhile Planning Commission, said: “US oil and gas exporters have gained from the current scenario. Now that the Iran-US war is more or less over, I think prices should come down. However, West Asian producers would need more time to increase their capacity to pre-war levels, so India may have to pay more in the near future.”

Expensive gas

The conflict also sharply increased international LPG prices. Saudi Aramco’s contract price, the benchmark for LPG imports to India, rose 46% from February to June 2026 as the market price implied the risk of supply disruptions and higher transport costs. The Saudi Aramco (CP) contract price for June 2026 is $760 per tonne for propane and $820 per tonne for butane. Cooking gas is primarily a mixture of propane and butane derived from crude oil and natural gas.

The war triggered a spike in oil prices, which have since declined after the US and Iran agreed to an interim peace deal. By 16:00 on Monday, benchmark Brent crude for August on the Intercontinental Exchange was down 1.75% at $79.16 a barrel after the opening round of talks between Iran and the US ended positively in Switzerland.

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The easing of conflict in West Asia, the signing of a Memorandum of Understanding (MoU) between Iran and the US and recent high-level talks on a final peace deal have raised hopes for improved supply conditions.

However, concerns remain over Israel’s occasional bombing of Lebanon despite the memorandum of understanding, with Iran threatening to close the Strait of Hormuz again.

High-level technical talks between the US and Iran under a 14-point memorandum of understanding concluded on Monday at the Lake Lucerne summit in Burgenstock. Iran and the US agreed to establish communication channels to “avoid incidents and misunderstandings” in the Strait of Hormuz, according to statements from Pakistan and Qatar, which acted as mediators during the talks.