Govt orders refiners to boost LPG output to meet cooking gas needs, Pg16

Key Highlights:

• Government invoked the Essential Commodities Act to maximize LPG production by Indian refiners due to the West Asia crisis.
• Refiners are directed to supply LPG solely for domestic consumers, ceasing its use for petrochemical production.
• India has over 33 crore domestic LPG consumers and relies heavily on imports to meet its LPG demand.
• In 2024-25, India's LPG consumption was around 31 million tonnes, with domestic production at only 13 million tonnes.

Detailed Insights:

• The order, issued under the Essential Commodities Act, 1955, aims to ensure uninterrupted LPG supply amidst disruptions in the Strait of Hormuz, a critical import route.
• Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL), and Hindustan Petroleum Corporation (HPCL), the three OMCs, supply almost all of the LPG consumed by Indian households.
• The government is in contact with international suppliers to source additional volumes of crude oil and LPG, ensuring no immediate fuel rationing or retail price increases.
• A recent import contract with the US will supply approximately 2.2 mt of LPG in 2026, reducing dependence on traditional West Asian suppliers.
• Indian refiners maintain crude oil stocks for around 25 days, with ongoing replenishment from non-Hormuz regions.

Key Concepts Involved:

• Essential Commodities Act: An act to control the production, supply, and distribution of essential commodities.
• LPG (Liquefied Petroleum Gas): A flammable mixture of hydrocarbon gases used as fuel in heating appliances and vehicles.
• OMCs (Oil Marketing Companies): Companies that handle the marketing and distribution of petroleum products.