US-Iran standoff over Strait of Hormuz, Center asks fuel retailers to secure 30-day LPG supplies amid supply concerns | Today’s news

With US President Donald Trump yet to make a final call for a tentative deal with Iran to reopen the Strait of Hormuz, one of the key sticking points in negotiations with Tehran, India’s central government has asked state-owned retailers to significantly increase liquefied petroleum gas (LPG) storage infrastructure.

The center also asked fuel retailers to maintain sufficient reserves to meet demand for at least 30 days, amid fears of supply disruptions caused by the recent conflict in West Asia, PTI reported on Friday.

Read also | State-run fuel retailers are ensuring ample supplies amid rising tensions with Pakistan

India is working on its strategic reserves: Official

Sujata Sharma, joint secretary in the petroleum ministry, told reporters, “We are working on strategic reserves. Oil marketing companies have been asked to come up with (a plan) to have LPG stock for at least 30 days and they are working on it.”

The government has asked state-owned oil marketing companies (OMCs) such as Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) to prepare plans for additional storage beyond normal commercial stocks.

India is managing to get oil despite the tensions

The development comes at a time when war in West Asia has disrupted global energy supplies, including supplies to India. 40 percent of New Delhi’s oil imports, 65 percent of natural gas and 90 percent of LPG supplies that came from the Gulf region have been cut off due to the three-month conflict.

While New Delhi has been able to obtain crude oil, a feedstock used to make petrol and diesel, and natural gas, which is used to generate electricity, make fertilizers and convert it into compressed natural gas (CNG) to power cars, as well as pipe it to domestic kitchens for cooking, the suspension of LPG imports has forced authorities to regulate supply to commercial consumers.

Read also | Can PM Modi’s five-nation tour help India deal with oil shock?

Sharma said India is also working to increase oil storage capacity.

India has sufficient reserves of petrol and diesel

Noting that New Delhi has adequate supplies of petrol, diesel, LPG, oil and natural gas, the Center added that India’s refineries were operating at optimum levels and LPG production was at an all-time high of around 52,000 tonnes per day.

Sharma said, “No drying up has been reported from any LPG distribution,” adding, “abnormal sales are being observed at many petrol pumps.”

Sales of gasoline and diesel are increasing

The diesel ministry official also noted that the higher retail sales of fuel was partly due to agricultural demand and a shift in purchases from wholesalers and private fuel dealers to government outlets due to the price differential.

More than 150 districts saw more than 30 percent increase in petrol sales, with as many as 14 districts seeing sales doubling, she added. Diesel sales grew by more than 30 percent in 156 districts, while six districts reported growth of more than 100 percent.

Sharma noted that sales of private fuel retailers fell by 38 percent for diesel, while state-owned OMCs saw a 29 percent decline in bulk diesel sales.

Although the prices of petrol and diesel sold at petrol stations operated by state-owned companies continue to be below cost, bulk customers such as telecom towers are charged market rates. Private fuel retailers have also increased petrol and diesel prices more than public sector companies.

IOC, BPCL and HPCL, which together account for about 90 per cent of the market, have raised fuel prices by nearly ₹7.50 per liter from May 15.

Read also | PSU fuel pumps are seeing an increase in sales as buyers shift away from private retailers

The government is keeping a close eye on the situation and has directed states and Union Territories to form special teams to prevent hoarding and black marketing. Consumers were also warned not to panic and urged to buy fuel only through authorized outlets.

Peace deal between the US and Iran

The US president said on Friday he would make a final decision on the Iran deal, possibly ending uncertainty over the conflict and giving a breather to global energy markets that have been taking a hit since the Strait of Hormuz was closed days after the US and Israel attacked Iran.

In a Truth Social post, Trump wrote: “Iran must agree to never have a nuclear weapon or a bomb. The Strait of Hormuz must be opened immediately, with no tolls, to unlimited shipping in both directions. All water mines (bombs), if any, will be terminated (we have detonated a number of such mines. There will not be many left!”

However, it remains to be seen how Trump will decide.

Key things

• Government of India is taking proactive measures to ensure LPG supply amid geopolitical tensions.
• The ongoing conflict in West Asia has disrupted global energy supplies and significantly affected India.
• Panic buying has been discouraged as authorities work to stabilize fuel availability and prices.