India has turned to Iran for liquefied petroleum gas (LPG) supplies for the first time in years, as disruptions around the Strait of Hormuz and a tightening global market prompt buyers to diversify sourcing.
Industry sources said Indian importers recently secured a cargo of Iranian LPG to bridge short-term supply gaps caused by shipping delays, rising freight costs, and constrained availability from traditional suppliers in the Gulf region. The move marks a notable shift, given the limited trade between the two countries in recent years due to geopolitical and sanctions-related constraints.
The Strait of Hormuz, a critical chokepoint for global energy shipments, has been facing operational uncertainties amid ongoing regional tensions. This has impacted vessel movements and increased insurance premiums, leading to supply disruptions and cost escalations for import-dependent countries like India.
India relies heavily on LPG imports to meet domestic demand, particularly for household cooking fuel under government-backed distribution schemes. Any disruption in supply chains can quickly translate into inventory pressure and pricing challenges.
Market participants noted that Iranian LPG offers logistical advantages in the current scenario, including shorter voyage distances and relatively competitive pricing. However, such purchases are expected to remain limited and opportunistic, depending on evolving geopolitical dynamics and regulatory considerations.
The development highlights India’s flexible procurement strategy in times of supply stress, as refiners and importers explore alternative sources to ensure continuity. Analysts suggest that continued instability in the region could lead to further diversification of sourcing patterns in the near term.
The government is closely monitoring the situation to ensure adequate availability of LPG and to mitigate any potential impact on domestic consumers.
