NEW DELHI: Amid fears of an imminent shortage of cooking gas due to import disruptions triggered by the ongoing Iran-Israel war, the Union petroleum ministry on Monday directed state-owned oil marketing companies (OMCs) to prioritise supply of LPG cylinders to domestic consumers over commercial users. The ministry also increased the waiting period for refills from 21 days to 25 days to prevent hoarding and black marketing.
“All public sector OMCs shall ensure that LPG so procured is supplied/marketed solely to consumers of domestic LPG only,” the Union petroleum ministry said in an order.
The government also directed all oil refineries and petrochemical complexes in India to utilise propane and butane streams to produce only LPG, instead of using them for other petrochemical products.
The move comes at a time when India’s LPG imports have been affected due to supply disruptions in West Asia amid the ongoing conflict in the region. India imports more than 50% of its LPG requirements, with around 80% of the imports coming from Saudi Arabia, Qatar and the UAE. Last week, the government directed OMCs to ramp up LPG production.
With supplies from the Gulf region impacted, the government is now diversifying its import sources. According to a petroleum ministry official, India is already in talks with countries including Australia, Norway and Algeria to secure additional LPG supplies.
New Delhi recently signed contracts to import around 2.2 million tonnes per annum of LPG from the US, accounting for nearly 10% of the country’s total annual LPG imports. Supplies under these contracts began in January 2026.
Meanwhile, several states including Bihar, Maharashtra and Punjab have reported shortages of LPG and fuel. However, the government has clarified that petrol pumps and gas stations are functioning normally and there is no fuel shortage in the country.
The decision to prioritise domestic LPG supply has, however, set alarm bells ringing among businesses. Several industry bodies have written to the government seeking urgent intervention.
The National Restaurant Association of India on Monday warned that any disruption in commercial LPG cylinder supply could lead to widespread closure of restaurants. The Bengaluru Hotels Association also said that many restaurants in the city may not be able to operate from Wednesday due to shortage of commercial LPG.
After industry bodies expressed concerns, the petroleum ministry stepped in to clarify that imported LPG for non-domestic use will be supplied to essential sectors such as hospitals and educational institutions. As for the shortage faced by restaurants and hotels, a panel of three OMC directors will review requests for LPG cylinders from them.
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