CHENNAI: India’s reliance on imported liquefied petroleum gas (LPG) is once again under focus as the government explores ways to ease cooking-gas prices for households. With global supply patterns shifting and US exporters rapidly expanding their LPG output, American cargoes are emerging as a potential stabiliser for India’s domestic market, which remains vulnerable to price swings in the Middle East.
The US has become the world’s largest exporter of LPG, supported by rising shale-oil and shale-gas production. This surge has created a steady surplus available for shipment to Asian buyers, offering an alternative to India’s traditional suppliers in the Gulf, according to reports.
For India—where nearly half of the population depends on subsidised or price-capped LPG cylinders—this diversification could prove financially significant. Greater access to US LPG gives state-run importers more bargaining power, allowing them to negotiate better supply contracts and hedge against sudden price spikes from Middle Eastern benchmarks.
Shipping LPG from the US is costlier due to longer voyage times, but expanding terminal capacity and improved freight economics have partially narrowed that gap. The sheer volume of American supply has also softened global prices in recent years, indirectly benefiting India even before the cargo reaches its shores.
Oil and gas sector analysts say that a stable inflow of US LPG could cushion India from geopolitical tensions in the Gulf, which frequently push up propane and butane prices—the key components used in Indian cooking gas.
If US producers continue ramping up exports, India stands to gain from more competitive long-term contracts, lower spot-market volatility and stronger supply security. In turn, these advantages could translate into lower procurement costs for state-run oil marketing companies, creating room for the government to reduce subsidies or pass on lower prices to consumers.
While the final impact depends on freight rates, currency movements and global energy conditions, the growing weight of American LPG in the global market is steadily shifting pricing power. For India, this opens the door to more predictable, and potentially cheaper, cooking-gas prices in the coming years.