India Boosts LPG Supplies to Commercial Users, Eases Restrictions
Quick Look
- India has lifted supply caps on LPG for commercial and industrial users following improved availability, including a record 1 million metric tons of U.S. imports in June.
- This allows for the restoration of 50% suspended allocations and increased petrochemical feedstock.
AI-generated summary
Why It Matters
India has increased LPG supplies to non-household users and removed caps following improved availability, including record U.S. imports. Previously, India prioritized household sales due to supply disruptions.
India has increased supplies of liquefied petroleum gas (LPG) to non-household users and removed caps on supplies to various commercial sectors after increased availability, the government said in a statement issued on Thursday.
"The restoration follows the recent improvement in the LPG supply situation," the government said.
India has decided to restore 50% LPG supplies to commercial and industrial customers whose allocation had been suspended.
The South Asian nation has also decided to increase the supply of propane, butane, and other molecules for petrochemical production, the government said.
Before the conflict, India was buying 90% of its LPG imports from Middle Eastern producers. Those supplies were hit following the closure of the Strait of Hormuz, forcing India to diversify its purchases raising imports from the U.S.
India's LPG imports from the U.S. are set to top 1 million metric tons in June, a record high. The nation has decided to produce at least 40,000 metric tons daily, the government said.
Due to the disruption, India had curtailed LPG supplies to some industries and commercial consumers as it prioritised sales to households. In India LPG, a mix of propane and butane, is used as cooking fuel.
The government had also instructed petrochemical makers to divert their feedstock to refiners to maximise local LPG output.
Open Questions
- Will U.S. imports continue at this record level?
- What is the long-term impact on Middle Eastern suppliers?
