India’s LPG consumption drops 17% in March as West Asia war disrupts supplies

New Delhi: India’s consumption of cooking gas LPG has witnessed a sharp decline in the first half of March, primarily due to supply disruptions linked to the ongoing conflict in West Asia, according to preliminary industry data.

Data shows that LPG consumption dropped to 1.147 million tonnes between March 1 and March 15, marking a 17.3 per cent decline compared to 1.387 million tonnes during the same period last year. Demand was also 26.3 per cent lower than the 1.557 million tonnes recorded in the first half of February.

The fall in consumption is largely attributed to disruptions in global supply routes. India imports around 60 per cent of its LPG requirements, with a significant portion transported through the Strait of Hormuz. The crucial shipping corridor has been effectively shut following US and Israeli strikes on Iran and Tehran’s retaliation, impacting LPG supplies from major producers such as Saudi Arabia and the United Arab Emirates.

To manage the shortfall and prioritise household cooking gas needs, the government has reportedly reduced LPG allocations to commercial establishments, including hotels and industries.

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Sales data from three state-owned fuel retailers, which together account for about 90 per cent of India’s LPG market, indicates that LPG consumption during March 1–15 was 16 per cent lower than the same period in 2024 and 10.6 per cent lower than in 2023.

In recent years, LPG demand in India has been growing steadily at around 3–4 per cent annually, largely driven by government initiatives aimed at encouraging households to shift away from traditional fuels like firewood and other polluting sources.

The ongoing conflict has also impacted aviation turbine fuel (ATF) demand. With several Gulf countries closing airspace and flights being suspended, ATF consumption fell 4 per cent year-on-year to 327,900 tonnes in the first half of March, and was down 12.3 per cent compared to the previous month.

However, the demand for transport fuels remained strong. Petrol sales rose 13.2 per cent year-on-year to nearly 1.5 million tonnes, while diesel consumption increased 8.2 per cent to 3.384 million tonnes during the same period.

On a month-on-month basis as well, petrol consumption grew 11.2 per cent, while diesel sales recorded a 7.7 per cent increase, reflecting steady mobility and economic activity despite global supply disruptions.