Government lifts all curbs on commercial LPG supply
What's the story
The Ministry of Petroleum and Natural Gas has announced the removal of all sectoral restrictions on the supply of non-domestic packed LPG and restored supplies to the levels prevailing prior to the West Asia crisis. The move comes after the easing of energy supply concerns arising from disruptions in West Asia. Bulk LPG supplies, which had been suspended at the onset of the crisis, have also been relaxed by 50% of pre-crisis consumption levels.
Crisis impact
Initial restrictions on LPG supplies
The initial restrictions on LPG supplies were imposed due to disruptions from the Iran conflict, which raised concerns over imports from West Asia. To ensure domestic consumption was not affected, the government had diverted supplies from commercial and industrial users to households. Commercial LPG supplies were later restored in phases to about 70% of normal levels while some sectors continued facing allocation cuts.
Supply restoration
Emergency measures to maximize LPG production
As part of its emergency measures, the government had also asked refineries to maximize LPG production by diverting C3 and C4 hydrocarbon streams from petrochemical production. This affected refiners and petrochemical producers such as Reliance Industries. However, with supply conditions improving, these measures have now been eased. The government noted improved indigenous LPG production and projected availability of imported LPG cargoes in its decision to ease restrictions.
Centre
Government reduces diversion of C3/C4 streams
"Taking note of the improved indigenous LPG production and the projected availability of imported LPG cargoes, the government has also decided to reduce the diversion of C3/C4 streams to the LPG pool. "The enhanced allocation of C3-C4 streams for non-LPG uses will be implemented while ensuring that the domestic LPG availability remains unaffected and aggregate indigenous LPG production is maintained at not less than 40,000 tonnes per day," it said.
Supply priorities
Government's commitment to expanding PNG usage
The ministry reiterated that ensuring uninterrupted household LPG supply is its top priority. It directed oil marketing companies (OMCs) to maintain detailed databases of commercial and industrial consumers for better supply planning. "A unified sectoral database will also be maintained across the OMCs to strengthen monitoring and operational coordination," it said. The government also reiterated its commitment to expanding piped natural gas (PNG) connectivity.
Market stabilization
Ministry has written to Chief Secretaries of all states
"Commercial and bulk consumers who have already shifted to Piped Natural Gas (PNG) will continue to remain on PNG. Other eligible LPG consumers having access to the PNG network, or those in the process of shifting to PNG, will be progressively transitioned to PNG in coordination with City Gas Distribution (CGD) entities," it said. The ministry has written to the Chief Secretaries of all States and Union Territories for ensuring smooth implementation of the revised supply arrangements.