India's LPG Consumption Declines 13% Amid West Asia Tensions

India's LPG Consumption Takes a Hit Due to West Asia Conflict

India's cooking gas LPG consumption plummeted by a steep 13 per cent in March as supply disruptions linked to the West Asia conflict hit availability for both household kitchens and commercial users. According to the latest official data, LPG consumption was at 2.379 million tonne in March, a 12.8 per cent decline from the 2.729 million tonne consumed in the same period last year.

The country imports approximately 60 per cent of its LPG requirements, with much of it coming through the Strait of Hormuz. The effective shutdown of this route following US and Israeli strikes on Iran and Tehran's retaliation, combined with disruptions to supplies from Saudi Arabia and the United Arab Emirates, has led the government to cut LPG supplies to commercial establishments like hotels and industries in order to safeguard household cooking gas availability.

According to the Oil Ministry's Petroleum Planning and Analysis Cell (PPAC), LPG cylinder sales to domestic households fell 8.1 per cent in March to 2.219 million tonne, while those sold to non-domestic users were down almost 48 per cent. Bulk LPG sales declined by a massive 75.5 per cent.

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The PPAC data showed lower consumption compared to government claims of LPG supplies being normal and all demand from domestic users being met. To offset the shortfall, the government directed refineries to divert feedstock from petrochemical production to boost LPG output, leading to domestic LPG production rising to 1.4 million tonne in March from 1.1 million tonne a year ago.

This push led to LPG production in the full 2025-26 fiscal (April 2025 to March 2026) rising to 13.1 million tonne from 12.8 million tonne output in the previous two financial years. Despite March being an exception, LPG consumption in the fiscal ended March 2026 was 6 per cent up to 33.212 million tonne.

LPG consumption has grown at a steady pace in recent years, driven by government efforts to replace firewood and other polluting fuels with cleaner alternatives. With the war leading to airspace closure in many Gulf countries and suspension of flights, jet fuel or ATF consumption witnessed almost flat growth at 807,000 tonne in March when compared with sales of 801,000 tonne a year ago.

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Other than the two war-impacted fuels, petrol and diesel sales posted a handsome rise in demand. For the full fiscal, ATF sales were up 2 per cent to 9.161 million tonne, while petrol consumption rose 6.5 per cent to 42.586 million tonne. Diesel consumption was higher by 3.6 per cent to 94.705 million tonne.

Industrial fuels naphtha and fuel oil posted a loss of 9.9 per cent and 1.4 per cent, respectively. Bitumen used for road making saw a 3 per cent rise in consumption to 8.84 million tonne in 2025-26.