New Delhi: The government on Thursday restored liquefied petroleum gas (LPG) supplies to commercial consumers such as hotels, restaurants and other businesses to pre-crisis levels, and lifted sector-specific restrictions imposed during the recent West Asia conflict, in a sign that energy supply concerns are easing as global markets stabilise.
The Petroleum Ministry, in a statement, said that restrictions on commercial LPG supplies had been lifted following an improvement in domestic production and the expected arrival of imported LPG cargoes.
The supply of bulk LPG, which had been suspended at the onset of the crisis, has also been partially resumed at 50 per cent of pre-crisis consumption levels.
The move marks the latest step by the government to unwind emergency measures introduced during the conflict, when fears of supply disruptions in West Asia prompted authorities to prioritise household cooking gas availability.
The restrictions were imposed after the Iran conflict disrupted LPG supplies from West Asia, which accounts for about 90 per cent of India’s cooking gas imports. To safeguard household consumption, the government initially halted supplies of commercial LPG to hotels, restaurants and industrial users, diverting available volumes to domestic consumers.
Supplies were subsequently restored in phases to about 70 per cent of normal levels, although several sectors continued to face curbs of up to 50 per cent of their usual allocations as authorities sought to conserve fuel stocks amid concerns over import availability.
Refineries were ordered to produce more LPG by diverting streams they would otherwise use for petrochemical production.
“In a major relief to industrial and commercial LPG consumers, the government has removed all sectoral restrictions on the supply of non-domestic packed LPG and restored supplies to the levels prevailing prior to the West Asia crisis,” the statement said.
Also, “the supply of bulk LPG, which had been suspended at the onset of the crisis, has been relaxed by 50 per cent of the pre-crisis consumption levels, providing significant relief to commercial and industrial consumers,” it said, adding that the restoration follows the recent improvement in the LPG supply situation.
To boost LPG production during the crisis, the government had invoked powers under the Essential Commodities Act to direct that C3 and C4 hydrocarbon streams be used exclusively for LPG production, diverting feedstock away from petrochemical and other industrial uses.
This move had hit companies like Reliance Industries hard. These refiners had to cut down their lucrative petrochemical production to boost LPG supplies.
With supply conditions improving, authorities have now decided to reduce the diversion of C3-C4 streams to the LPG pool and restore allocations to petrochemical and other downstream industries, while ensuring domestic LPG production remains above 40,000 tonnes per day.
“Taking note of the improved indigenous LPG production and the projected availability of imported LPG cargoes, the government has also decided to reduce the diversion of C3/C4 streams to the LPG pool.
“The enhanced allocation of C3-C4 streams for non-LPG uses will be implemented while ensuring that the domestic LPG availability remains unaffected and aggregate indigenous LPG production is maintained at not less than 40,000 tonnes per day,” it said.
The Centre of High Technology under the ministry has been directed to issue organisation-wise allocation of these enhanced C3/C4 streams for the petrochemical and other critical sectors and submit regular reports to the ministry.
The decision comes amid broader signs that the energy crisis triggered by the conflict is easing. Crude oil prices have fallen back to pre-war levels, government crisis briefings have been suspended, and fuel supply concerns have receded as shipping and energy flows normalise.
The government said uninterrupted LPG supplies to households remain its top priority and directed state-run oil marketing companies to maintain comprehensive databases of commercial and industrial consumers to improve supply planning.
At the same time, authorities reiterated plans to accelerate the shift of commercial and industrial consumers to piped natural gas (PNG), with eligible LPG users being progressively migrated to city gas networks where available.
The rollback of emergency restrictions underscores New Delhi’s confidence that domestic production and imports are sufficient to meet demand, reducing the need for crisis-era rationing measures that had affected industrial and commercial fuel users.
The ministry said that since the onset of global supply disruptions arising from the West Asia crisis, the government has accorded the highest priority to ensuring the uninterrupted availability of LPG to domestic consumers across the country.
“In line with this, temporary restrictions were imposed on the supply of commercial packed LPG. The timely policy interventions and coordinated efforts by oil marketing companies (OMCs) helped maintain stable supplies despite challenging global supply chains.”
The government has directed OMCs to continue maintaining comprehensive data on commercial and industrial LPG consumers to facilitate efficient planning and supply management. A unified sectoral database will also be maintained across the OMCs to strengthen monitoring and operational coordination.
“At the same time, the government remains committed to expanding PNG connectivity. Commercial and bulk consumers who have already shifted to piped natural gas (PNG) will continue to remain on PNG. Other eligible LPG consumers having access to the PNG network, or those in the process of shifting to PNG, will be progressively transitioned to PNG in coordination with city gas distribution (CGD) entities,” the statement said.
In this regard, the Secretary, Ministry of Petroleum and Natural Gas, has written to the chief secretaries of all states and Union Territories for ensuring smooth implementation of the revised supply arrangements.
