US Emerges As India’s Largest LPG Supplier Amid Strait Of Hormuz Crisis

The United States has emerged as India’s largest LPG supplier following disruptions triggered by the Middle East crisis and the subsequent closure of the strategically important Strait of Hormuz, Union Oil Minister Hardeep Singh Puri said on Friday.

Puri said India has also ramped up domestic LPG production to make up for the decline in imports from Gulf countries.

"Today, I am happy to inform you that the United States accounts for something like 67 per cent of our LPG imports," he said at an event organised by the Confederation of Indian Industry (CII).

The minister said India managed to protect consumers from supply disruptions arising from the Middle East crisis through measures including diversification of supply sources, expansion of refining capacity and increased domestic production.

"Today, I think we are in the happy situation of being able to say that, as far as India is concerned, we have moved on from that," he said, referring to the country's evolving approach to energy security — from relying primarily on hydrocarbon access to adopting diversified imports, strategic partnerships, infrastructure expansion and alternative fuels.

Before the conflict broke out in the Middle East, India sourced up to half of its crude oil from countries that relied on the Strait of Hormuz for transit. Around 90 per cent of LPG imports and 60 per cent of other gas imports also passed through the waterway.

Although these supplies were disrupted, India swiftly diversified its sources to ensure that no part of the country faced a shortage, Puri said.

"I can say with a degree of confidence, not one station went dry, not one," he added, referring to India's network of more than 1.07 lakh fuel retail outlets, up from 52,000 in 2014.

India has also increased the number of countries supplying its crude oil from 27 to 41 and expanded city gas distribution coverage from 55 geographical areas to 309.

"We never ran short of crude oil supplies. We always had about 60 days (cover); there was no shortage."

Puri also highlighted the government's recently approved Rs 84,000 crore Samudra Manthan programme, which seeks to boost deepwater oil and gas exploration and strengthen long-term energy security.

"The government is not going to do the drilling. The drilling is going to be done by private players," he said.

Under the programme, the government will provide support of up to 50 per cent of drilling costs, or a maximum of Rs 650 crore per well, to encourage private investment in high-risk offshore exploration.