India has directed state-owned companies and private refiners to increase domestic liquefied petroleum gas (LPG) production as uncertainty over supplies through the Strait of Hormuz continues amid the Iran war. The government has asked refiners and crude oil producers to implement all technically and economically feasible measures to raise LPG output beyond current minimum production levels. The move is aimed at strengthening domestic cooking gas availability and reducing the country's vulnerability to disruptions in international supply routes.

According to a government notification issued on August 13, refiners have been instructed to explore alternative ways of increasing LPG production, including using feedstocks in different ways. One option mentioned is converting naphtha into LPG. The government now wants the industry to build the capacity to produce as much as 63,810 tonnes of LPG a day. Individual refiners have also been assigned upper-limit production targets as authorities seek to maximise domestic supplies.

India imports around two-thirds of the LPG it consumes, making the disruption of major shipping routes a significant concern for the country's energy security. About 90% of India's LPG imports normally pass through the Strait of Hormuz, a key global energy corridor. Since the US-Iran war disrupted traditional supply routes, Indian buyers have sought alternative sources, including supplies from the United States and newer suppliers such as Algeria.

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Domestic refiners had been producing around 36,000 tonnes of LPG a day before the conflict, but output has already increased to as much as 54,000 tonnes a day. The latest government directive seeks to push production further, with the industry expected to work towards the nationwide target while maintaining operational and economic feasibility. Reliance Industries' domestic-market-focused refining unit has been assigned the largest individual target of 18,000 tonnes a day.

State-run Oil and Natural Gas Corporation and Oil India, along with gas pipeline operator GAIL India, have also been asked to contribute to the overall production target. Their combined contribution is expected to account for roughly a tenth of the nationwide target. Refiners have additionally been instructed to strengthen infrastructure for LPG storage, evacuation and transportation so that higher production can be moved efficiently through the domestic supply network.

India had traditionally relied heavily on imported LPG because domestic production was considered less profitable than gasoline and petrochemical feedstocks. The latest measures reflect the government's effort to increase domestic availability as global supply conditions remain uncertain. Companies will have to raise production within stipulated timelines, while the government plans to review the targets every January and July.

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