India Directs Refiners to Boost LPG Production, Supply Only to IOC, BPCL and HPCL
Government prioritises household cooking gas supply amid global energy uncertainty
New Delhi, Mar 6: The government has directed oil refiners to ramp up production of liquefied petroleum gas (LPG) and prioritise its supply for domestic consumption, as authorities seek to safeguard cooking fuel availability during ongoing volatility in global energy markets.
According to an official directive issued on Thursday, refiners have been instructed to maximise LPG output and sell the fuel exclusively to the three state-run oil marketing companies Indian Oil Corporation, Bharat Petroleum Corporation Limited and Hindustan Petroleum Corporation Limited.
The order comes amid rising geopolitical tensions in West Asia that have triggered concerns over possible disruptions to global energy supply chains and shipping routes, particularly through the strategically important Strait of Hormuz.
Authorities have also instructed refiners not to divert propane and butane the key components used in LPG production for petrochemical manufacturing. In addition, the three oil marketing companies have been asked to ensure that LPG distribution is restricted to domestic household consumption.
Liquefied petroleum gas, a mixture primarily composed of propane and butane, is the most widely used cooking fuel in Indian households. The directive is aimed at maintaining sufficient supply in the event of tighter global energy markets.
Demand for cooking gas in India has increased significantly over the past decade, largely driven by welfare initiatives such as the Pradhan Mantri Ujjwala Yojana, which expanded LPG access to millions of low-income households.
Despite an increase in local output, India continues to depend heavily on imports to meet its LPG needs. The country currently imports around 60 per cent of its total LPG requirement, making domestic availability sensitive to global price fluctuations and shipping disruptions.
By directing refiners to prioritise LPG production and prevent the diversion of key feedstocks to industrial uses, the government aims to protect household fuel supplies if international markets tighten further.
India’s energy consumption is projected to grow steadily alongside economic expansion and rising household demand. As the world’s third-largest oil consumer, the country’s petroleum usage is expected to reach nearly 250 million tonnes by the financial year 2026–27.
With millions of households relying on LPG for daily cooking, ensuring uninterrupted access to the fuel remains a critical policy focus. The latest directive underscores the government’s intent to prioritise domestic energy security during periods of global market uncertainty.
