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Informist, Thursday, Mar. 12, 2026

 

--Oil minister: Commercial cylinder supply to start Thursday 
--Oil minister: Govt absorbed significant portion of LPG cylinder price hike 
--Oil minister: Govt asked pollution board to OK biogas use amid crisis 
--Oil minister: LPG supply fully secured despite current demand conditions 
--Oil minister: LPG production increased by 28% in last 5 days 
--CONTEXT: Oil minister Puri's comments in Lok Sabha 
--Oil minister: Natural gas supply prioritised for household, situation stable

 

NEW DELHI – The world is facing an energy crisis of the current scale for the first time, but India is positioned better than most of its peers with supplies flowing in from diversified sources, Oil Minister Hardeep Singh Puri said Thursday. India's crude supply position is secure, with no shortage of aviation turbine fuel, petrol, diesel, kerosene, or fuel oil, Puri said in a statement in the Lok Sabha, his first formal statement since the West Asia crisis broke out on Feb. 28. 

 

"Retail outlets across the country are stocked, and supply chains for these products are functioning normally," Puri said. "Additional allocation of PDS kerosene has been issued to all the states," he said. The primary focus of the government is to ensure that fuel for domestic use is secured and that all households have access to it. "Modi govt's foremost priority is that the kitchens of India's 33+ crore (over 330 million) families, especially the poor and the underprivileged, do not face any shortage," he said.

 

India currently faces supply constraints after Israel and the US launched joint military strikes on Iran on Feb. 28, prompting Tehran to hit back at the Jewish state and at US military installations around the Persian Gulf. Iran also shut the Strait of Hormuz, a narrow waterway that connects the Gulf to the Arabian Sea and the Indian Ocean, resulting in a sharp rise in prices of crude oil and natural gas.

 

A fifth of global crude oil supply flows through the Strait of Hormuz. About half of India's crude oil imports – primarily from Iraq, Saudi Arabia, the United Arab Emirates, and Kuwait — also pass through the strait, making the country particularly vulnerable to shipping bottlenecks there and to surging freight and insurance rates.

 

"For the first time in recorded history, the Strait of Hormuz has been effectively closed to commercial shipping," Puri said. "Despite India having no role in causing the conflict, like many countries, India has to navigate through its consequences."

 

India imported large volumes of LPG from West Asia in 2025, representing 46.9% of its LPG imports. LPG remains the primary cooking fuel for millions of households, and any disruption could quickly affect its availability. According to the oil minister, LPG procurement has now been actively diversified, with cargoes being secured from the US, Norway, Canada, Algeria, and Russia, in addition to available Gulf sources.

 

The government has already issued multiple orders to oil marketing companies as well as to distributors to prioritise LPG supply for domestic consumption over commercial and industrial use. The government has also identified educational institutions and hospitals for prioritising LPG supply within the industrial or commercial sectors. To ensure smooth supply of domestic LPG, the government has asked oil marketing companies to dispatch a second cylinder for household use after 25 days of booking, instead of 21 days earlier. This move is aimed at stabilising and pacing out consumption, but over the last two days, panic-booking has triggered nationwide disruption.

 

Social media and news reports showed citizens flooded distributors' offices to book LPG cylinders, with many unable to even book with the supplier. Given this situation, the government has issued a 'delivery authentication system' which will help with systematic booking, and prevent the risk of black marketing. The central government is also in touch with state governments to ensure the black marketing of LPG cylinders is avoided.

 

According to Puri, field reports indicate hoarding and panic-booking at the distributor and retail level, driven by consumer anxiety rather than any actual supply shortage. "The House should be clear on this: the rush-booking pressure in some localities reflects a demand distortion, not a production or supply failure," he said. Given the government steps, LPG production has been increased 28% through refinery directives, and further procurement is actively underway, he said. 

 

The minister also touched upon the plight of the hospitality sector, which has been heavily impacted by the shortage of LPG cylinders. The government had directed oil marketing companies and distributors to divert commercial cylinders towards domestic-use bookings. "In a major decision, 20% of the average monthly commercial LPG requirement will be allocated from today by OMCs, in coordination with the state governments, so that there is no hoarding or black marketing," Puri said. The decision was taken by a three-member committee tasked with determining the extent of support needed by the commercial LPG sector. 

 

The government has also activated alternative fuel options to ease pressure on LPG and gas channels, he said. The Ministry of Environment, Forest and Climate Change has advised state pollution control boards to permit, for the duration of this crisis period, the use of biomass, RDF (refuse-derived fuels) pellets, and kerosene or coal as alternative fuels for the hospitality and restaurant segment for one month, which would enable a wider range of establishments to switch and free up LPG for priority consumers.  

 

The government has also managed natural gas supply through prioritised allocation, and the position is stable well beyond immediate need, Puri said. "I am pleased to inform the House that the shortfall has been substantially offset through alternative procurement...large LNG cargoes are arriving on an almost daily basis through alternative supply routes, and India has sufficient gas production and supply arrangements to sustain this position even in the event of a prolonged conflict," the oil minister said. "Power generation for every household and for industry is fully protected." 

 

Brent crude oil prices have surged since the conflict broke out, reaching $119.50 per barrel on Monday, the highest since June 2022. It has since cooled from that level and at 1736 IST, was trading at $98.02 per barrel, still much higher than the average of $65 per barrel before the war broke out.

 

On Saturday, Indian Oil Corp. Ltd. increased the price of domestic and commercial LPG cylinders sold under its "Indane" brand across metropolitan cities by INR 60 per cylinder. Given the situation, there is concern in many quarters about whether there will be a further increase in domestic fuel prices. Puri said that the government has absorbed a significant hit from the higher international fuel prices, and without the government's intervention, the price of domestic LPG cylinders would have been much higher. LPG cylinder prices in India are also lower than the prices in many neighbouring countries, he said. The government is already compensating oil marketing companies for their under recoveries in LPG to the tune of INR 300 billion. 

 

Puri also reiterated that India is comfortably positioned in terms of its energy supply, with energy flowing in from 40 destinations. "Before this crisis, approximately 45% of India's crude imports transited the Hormuz route. Thanks to Hon'ble PM's outstanding diplomatic outreach and goodwill, India has secured crude volumes that exceed what the disrupted Strait route would have delivered in the same period," he said. Non-Hormuz sourcing has risen to approximately 70% of crude imports, up from 55?fore the conflict began, he said. Refineries are also operating at high capacity utilisation, and in several cases, they are exceeding 100%, the minister added. 

 

"This is not the moment for rumour-mongering or fake narratives," Puri said, while concluding his statement. "India is navigating the most severe global energy disruption in recorded history. Crude supply is flowing. Gas is prioritised for homes and farms. LPG production has been stepped up by 28%. Consumer prices are held far below what markets and regional comparators would dictate. Schools are open. Petrol is on the forecourt," the oil minister said.  End

 

US$1 = INR 92.19

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Priyasmita Dutta

Edited by Avishek Dutta

 

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