India's domestic LPG production has increased by around 25%, with the additional volumes directed entirely to households, Ministry of Petroleum and Natural Gas Joint Secretary Sujata Sharma said on Wednesday.

The increase follows a government order earlier in the week directing refineries and petrochemical complexes to maximize LPG production amid supply shortage concerns linked to shipping disruptions around the Strait of Hormuz, OPIS reported previously. Under the order, all propane and butane streams, as well as downstream propylene and butene, have to be redirected into the LPG pool for domestic distribution through the country's oil marketing companies.

In a video posted by the Press Information Bureau, Sharma said that household consumers are being prioritized for domestic LPG supply, while key sectors like healthcare and education are being prioritized for non-domestic LPG supply.

A committee comprising executive directors from the country's national oil firms Indian Oil Corp., Hindustan Petroleum Corp. and Bharat Petroleum Corp. has been set up to review LPG allocations to commercial sectors.

The committee is consulting with state authorities and industry bodies to ensure available supply is distributed fairly and transparently, Sharma added.

India is the largest importer of Middle Eastern LPG in Asia. Regional tensions have caused domestic LPG prices to spike and raised concerns over supply shortages.

India-based traders heard that deals for April-delivery LPG cargoes into the country have recently been concluded at a premium of $300s per metric ton to the contract price, a level many market participants consider extremely high.

"Deals done at such high levels just reflect how urgent prompt demand is and how much India relies on LPG as a key everyday fuel," a trader said.

Another analyst said such elevated levels may not be sustainable for consumers or companies over the long term. "India needs to look for alternative supply sources such as the U.S.," the analyst added.

This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.

--Reporting by Cheryl Lee, clee@opisnet.com; Editing by Mei-Hwen Wong, mwong@opisnet.com

(END) Dow Jones Newswires

March 12, 2026 03:05 ET (07:05 GMT)

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