India Seeks New LPG Sources As Gulf Conflict Strains Energy Supplies

India is securing more liquefied petroleum gas cargoes from new sources such as the United States, Norway, Canada and Russia, besides sources in the Gulf region that remain available, Oil Minister Hardeep Singh Puri said on Thursday, as the world’s second-largest importer grapples with tight supplies.

The federal environment ministry has advised state pollution control boards to permit the use of biomass, kerosene and coal as alternate fuels for the hospitality and restaurant segment for one month to free up LPG usage, Puri said.

India previously imported about 60 percent of its LPG requirements from Gulf countries, Puri told parliament, adding that purchases had now been diversified. The federal government has invoked emergency powers ordering refiners to maximize production of LPG and cut sales to industry to avoid a shortage for its estimated 333 million homes with LPG connections.

Domestic LPG supply is fully protected and the delivery cycle is unchanged, Puri said. The panic about cooking gas supplies was triggered by consumer anxiety rather than a supply shortage, he added.

India’s crude oil, LPG, and liquefied natural gas supplies have been disrupted due to global shipping constraints after the US and Zionist entity’s war with Iran halted traffic through the Gulf and the Strait of Hormuz. Despite the government steps, restaurants, hotels, and industries across sectors are beginning to feel the strain from the tighter supplies of LPG, mainly used as cooking fuel.

Puri said that 20 percent of the average monthly commercial LPG requirement will be allocated from Thursday by oil marketing companies, in coordination with state governments to avoid hoarding or black marketing. India consumed 33.15 million metric tons of cooking gas last year, with imports accounting for about 60 percent of demand.

Puri said that the South Asian nation’s current crude supply position is also secure as sourcing of non-Hormuz crude has increased to 70 percent of its total imports. India’s petrol and diesel availability is also fully secure and LNG cargoes are arriving almost daily from alternative routes, he said.

“India has sufficient gas production and (LNG) supply arrangements to sustain this position even in the event of a prolonged conflict,” Puri said.

Iran will allow Indian-flagged tankers to transit the Strait of Hormuz, a conduit for 40 percent of the South Asian nation’s crude imports, an Indian government source said on Thursday, but an Iranian source outside the country denied any such deal was reached.

India, the world’s No 3 oil consumer, said on Thursday the foreign ministers of the two countries have had three conversations in recent days and the latest one this week focused on “issues pertaining to the safety of shipping and India’s energy security”.

“Beyond that, it would be premature for me to say anything,” foreign ministry spokesperson Randhir Jaiswal told a weekly media briefing. The Indian source, who was briefed on the matter, declined to be identified, citing a lack of authorization to speak to media, while the Iranian source said the matter was a sensitive one.

On Thursday, the Suezmax tanker Shenlong, carrying Saudi crude, arrived at a port in Mumbai after transiting the strait. The Liberia-flagged vessel was the first crude carrier to reach India from the Middle East since the war between Iran and the United States and Zionist entity broke out in late February, according to LSEG data. The customer is state-run Bharat Petroleum Corp BPCL.NS, said a source with direct knowledge of the matter. The company did not immediately respond to a request seeking comment.

The Indian source said two other foreign-flagged tankers believed to be bound for India had recently transited the Strait, and that Iran had given assurances of safe passage for Indian-flagged vessels after the foreign ministers of both countries spoke by telephone late on Tuesday.

The source said the situation remained fluid, with limited clarity on how instructions were being relayed across different layers of Iran’s administration.

In a statement after the talks between India’s S Jaishankar and his counterpart, Seyed Abbas Araghchi, Iran’s foreign ministry said the United States should be held accountable for the “insecure situation and problems arising for shipping in the Persian Gulf”. Neither side mentioned any agreement on allowing safe passage for Indian vessels.

On Wednesday, India said 28 Indian-flagged vessels were operating west and east of the Strait with 778 Indian sailors aboard. “Authorities, ship managers and recruitment agencies are coordinating closely with Indian embassies and local authorities to ensure safety and provide assistance to Indian seafarers,” the Indian petroleum ministry said in a statement.

India has given safe harbor to 183 Iranian sailors from a vessel that docked after the war broke out between Iran and the United States and Zionistentity.

New Delhi had allowed three Iranian ships that departed following a naval exercise in the Bay of Bengal to dock, but one was later sunk by a US submarine in international waters, and another sought assistance from Sri Lanka.