India Plans To Double US LPG Imports To Reduce Gulf Dependence

India is planning to increase its imports of liquefied petroleum gas (LPG) from the US to double the quantities it gets annually. This is part of the country's overall plan to reduce reliance on the traditional suppliers from the Gulf since recent supply disruptions in West Asia have exposed the risk of depending on a single region for energy supplies.

Though acquiring more LPG from the US may aid in supply diversification, it may also lead to increased logistics costs. The transportation time of the shipments from the US to India is longer than that of Gulf countries' cargoes, and the pricing model is also different.

Consequently, the higher freight and purchase costs may potentially lead to a decrease in the profit margins of the government-run oil marketing firms, like Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL).

Why Is India Increasing LPG Imports From The US?

At present, India imports around 2.2 million tonnes of LPG from the US every year. Officials are now exploring ways to significantly increase this volume while also building a 30-day strategic LPG reserve to better protect the country from future supply disruptions.

The government's diversification plan gathered pace after geopolitical tensions in West Asia disrupted shipping through the Strait of Hormuz, one of the world's most important energy trade routes. Since India depends heavily on this route for fuel imports, the disruptions forced oil companies to look for alternative sources.

Over this period, America became the leading source of supply. As per Kpler statistics, America delivered an average of 8% of India's total LPG imports in 2025. This portion rose to almost 12% in January 2026, when a formal agreement was activated, and increased to 13% in February. The March figure dramatically soared to 37% due to the interruption of the war in the passage of cargoes through the Strait of Hormuz, then the number rose to 40% in April, 55% in May and finally 65% in June 2026.

What Is The 30-Day Strategic LPG Reserve?

Apart from increasing imports, the Ministry of Petroleum and Natural Gas has asked oil marketing companies (OMCs) to prepare a roadmap for creating a 30-day strategic LPG reserve.

Currently, OMCs maintain a 45-day rolling stock to meet regular household and commercial demand. Such a strategic reserve, if established, would not only complement the existing stocks but also act as a buffer during emergencies arising from supply interruptions, shipping setbacks, or sudden price hikes in the global market.

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