Liquefied petroleum gas (LPG) imports to India are likely to halve this month due to the war in Iran and the blockade of the strategic Strait of Hormuz, Reuters reported, citing traders and ship tracking data.
India imports 60% of its LPG needs, with 85-90% of this coming from Gulf countries such as Saudi Arabia and the United Arab Emirates, which use the Strait of Hormuz as a transit to transport oil and gas to users. The strait has been effectively closed since the first week of March.
Until the February 28 US-Israeli strikes against Iran, the Middle East accounted for about 90% of seaborne shipments, which reached 22.7 million metric tons last year.
But so far this month, the share of Gulf exporters has fallen to about 55 percent, with about 40 percent of imports coming from the U.S. and Russia and Argentina, LSEG data showed, according to Reuters.
About 50% drop in imports in March
Traders and ship tracking data from LSEG are said to indicate that India will import 1.190 million metric tonnes of LPG this month, down 46 percent from February on a daily basis.
LPG is mainly used as a fuel for cars, heating and for the production of other petrochemical products. Earlier this month, the center asked consumers to avoid panic buying of LPG cylinders and switch to piped gas where possible.
However, imports from Russia are limited by a lack of available volumes and vessels, as well as relatively long routes from the key LPG export of Ust-Luga in the Baltic Sea.
The government said that local refineries have increased LPG production by around 40 pe since the beginning of March.
“There is no shortage of LPG”, says the government
The Indian government claims that there is no shortage of LPG in the country.
Sujata Sharma, Joint Secretary (Marketing & Oil Refinery), Ministry Oil and natural gassaid on March 13: “There is no shortage of LNG supplies. There is no shortage of LPG. I appeal again to all consumers: those who can switch from LPG to PNG should do so immediately.”
In the Rajya Sabha on March 24, Prime Minister Narendra Modi said, “It is our government’s endeavor to ensure that we do not remain too dependent on just one fuel source.”
He said that efforts are being made to ensure large-scale increase in domestic production of LPG.
On March 24, the Ministry of Ports, Shipping and Waterways confirmed that two LPG tankers Pine Gas and Jag Vasant carrying more than 92,000 tonnes of LPG had passed through Hormuz and were expected to arrive at ports in India between March 26 and 28.
Earlier, MT Shivalik and MT Nanda Devi, carrying about 92,712 tonnes of LPG, reached the Indian coast safely.
The Indian-flagged oil tanker Jag Laadki, carrying 80,886 tonnes of crude oil from the UAE, arrived at Mundra on 18 March.
