India concludes LPG import deal with US

• Indian PSU oil companies have successfully concluded a one-year structured contract to import around 2.2 million tonnes per annum (MTPA) of LPG from the US Gulf Coast for the contract year 2026. 

• This was announced by Union Minister of Petroleum and Natural Gas Hardeep Singh Puri on November 17.

• This represents close to 10 per cent of India’s annual LPG imports and marks the first such structured US LPG contract for the Indian market.

How was the deal concluded?

• India imports about 60 per cent of its domestic LPG consumption. Prices of LPG in the country are linked to its price in the international market (Saudi Contract Price).

• In 2024, about 90 per cent of the 20.4 million tonnes of LPG imports came from UAE, Qatar, Kuwait and Saudi Arabia.

• The minister said India has been consistently working to secure affordable and reliable LPG supplies by diversifying its sourcing options. 

• As part of this effort, a team of officials from IndianOil, Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL) had visited the United States from July 21 to 24 and engaged in discussions with major US producers. 

• These discussions, based on Mont Belvieu as the benchmark for LPG purchases, have successfully concluded with the finalisation of the contract.

• The minister noted that one of the world’s largest and fastest growing LPG markets has now opened up to the United States.

(The author is a trainer for Civil Services aspirants.)