US Becomes India's New LPG Partner; Know Inside Story of 2.2 Million Tonne Deal

New Delhi: Recent tensions involving Iran in the Middle East have completely transformed India's LPG import strategy. To secure supplies while reducing reliance on traditional suppliers in the region, India turned to other nations across the globe.

The United States has emerged as the largest supplier in this shift. While this move prevented LPG shortages in the domestic market, it led to higher logistics costs due to the longer maritime distances involved.

What are India's shifting LPG Import Figures? 

According to CAS data, India's LPG imports dropped from 322,000 metric tonnes in the week ending March 5 to 265,000 metric tonnes in the week ending March 19.
Imports from West Asia saw a sharp decline, falling to just 89,000 metric tonnes. This represents only 34 percent of total imports—the lowest level since January.
In contrast, supplies from other regions rose to 176,000 metric tonnes. Interestingly, in the preceding week, imports from other regions were zero, with the entire supply coming solely from the Middle East.

Is there a Major Deal Between India and the US? 

Indian Oil Marketing Companies (OMCs) have signed a contract to import 2.2 million metric tonnes of LPG from the US for the year 2026. This volume is equivalent to shipments from approximately four large VLGC (Very Large Gas Carrier) vessels per month. In the first two months of 2026 alone, India has already imported around 480,000 metric tonnes of US LPG—equivalent to about 11 ship cargoes.

According to a report by rating agency CRISIL, the US has emerged as a key LPG supplier for India as of April 2026. The US share of India's total LPG imports rose from just 8 percent in February to approximately one-third (33%) by April.
This deal involves an annual volume of 2.2 million tonnes, representing about 10 percent of India's total LPG import requirements.

Have imports from other countries also increased? 

Iran also returned to India's import mix, supplying about 6 percent of the shipments in April. Additionally, India sourced LPG from countries such as Argentina, Chile, France, and the Netherlands. While this diversification strengthened the country's energy security, companies had to pay high freight costs due to the long transportation distances involved.