India's LPG consumption down 13% in March: What's the reason?
What's the story
India's liquefied petroleum gas (LPG) consumption witnessed a sharp decline of 13% in March, owing to supply disruptions caused by the ongoing West Asia conflict. The data from the Oil Ministry's Petroleum Planning and Analysis Cell (PPAC) shows that LPG consumption stood at 2.379 million tons in March, compared to 2.729 million tons during the same period last year.
Impact assessment
Impact of conflict on LPG supplies
The conflict has particularly affected supplies through the Strait of Hormuz, a key route for India's LPG imports. This has led to disruptions in supplies from major exporters such as Saudi Arabia and the United Arab Emirates (UAE). In light of these challenges, the Indian government has had to cut LPG supply to commercial establishments like hotels and industries, prioritizing household consumption instead.
Mitigation measures
Decline in domestic and commercial consumption
The PPAC data shows that LPG sales to domestic users fell by 8.1% to 2.219 million tons in March. The impact was even more severe on non-domestic segments, with LPG sales to commercial users dropping nearly 48%. Bulk LPG consumption plummeted by a staggering 75.5%. To counter these losses, the government has directed refineries to divert feedstock from petrochemical production toward boosting domestic output of LPG.
Production boost
Increase in domestic production
Thanks to the government's intervention, domestic LPG production has increased from 1.1 million tons a year ago to 1.4 million tons in March. For the entire fiscal year of 2025-26 (April 2025-March 2026), production rose to 13.1 million tons from the previous two fiscal years' output of 12.8 million tons. Despite March's decline, overall LPG consumption for the fiscal year rose by a healthy 6% to reach an impressive total of over 33 million tons, reflecting long-term growth driven by cleaner fuel adoption policies and initiatives across India.