NEW DELHI: The Centre has begun gradually restoring fuel supplies to industry, increasing allocations of liquefied petroleum gas (LPG) and natural gas for key industries, while maintaining the sectoral cap. The move comes amid signs of easing of the conflict in West Asia following the announcement of a two-week ceasefire.
The government has raised LPG allocation for critical sectors, including pharmaceuticals, food, polymers, agriculture and steel, to 70% of their pre-March 2026 average consumption, according to a letter dated Wednesday from the secretary in the ministry of petroleum and natural gas to state chief secretaries.
The ministry has also increased natural gas allocation for the fertilizer industry to 95% of their last six months’ average consumption.
In March, the government had prioritized LPG supplies for household cooking after about 90% of imports were cut off following the closure of the Strait of Hormuz after coordinated strikes by the US and Israel against Iran. Since then, supplies to commercial and industrial users have been gradually restored. India’s annual LPG consumption is about 33 million tonnes, of which 60-65% is imported.
The government had earlier allotted up to 70% LPG for commercial supplies to states, including an allocation of up to 10% for promoting piped natural gas (PNG). Consumption has been capped at a sectoral limit of 200 tonnes per day, and under the new directive, priority will be given to units that cannot shift from LPG to PNG.
“It is now conveyed that industrial units in the sectors of Pharma, Food, Polymer, Agriculture, Packaging, Paint, Uranium, Heavy Water, Steel, Seed, Metal, Ceramic, Foundry, Forging, Glass, Aerosol etc. shall also receive 70% of the units’ pre-March 2026 Bulk non-domestic LPG consumption level subject to a overall sectoral limit of 0.2 TMT/day,” the oil ministry’s letter said.
Addressing the media on the developments in West Asia and the domestic fuel stock situation, Sujata Sharma, joint secretary in the ministry of petroleum and natural gas, said that since 14 March, about 93,085 tonnes of commercial LPG, equivalent to over 4.9 million 19-kg cylinders, have been sold.
On the increase in natural gas allocation for the fertilizer sector, Sharma said that based on available inventory and scheduled LNG cargo arrivals, the overall gas allocation to fertilizer plants is being further enhanced by 5% to reach approximately 95% of their six-month average consumption, effective 9 April.
Gas supply to other industrial and commercial sectors, including City Gas Distribution (CGD) networks, has also been enhanced by a further 10%, with effect from 6 April.
She also said that refineries have been directed to supply a combined 800,000 tonnes per day of propane, butane, propylene and other molecules to critical sectors, including pharmaceuticals, food, public distribution and chemicals. This follows a 1 April ministry directive allowing refining companies, including petrochemical complexes, to make minimum quantities available to these sectors, based on specific allocations and refinery sources determined by the Centre for High Technology.
Mint earlier reported that the pharmaceutical industry had reached out to the government to increase supplies of these molecules to meet domestic demand for critical drugs.
