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| Gas problem |
Meta Description: The Strait of Hormuz disruption has exposed a hidden vulnerability in India’s LPG supply chain. Behind the long queues lies a story of 91% import dependence, missing strategic reserves, and the return of firewood to modern kitchens. Read the full investigation.It began, as most kitchen crises do, with a simple frustration: the gas cylinder didn’t arrive. But by the second week of March 2026, that frustration had curdled into something darker. In Kerala, a mother named Babitha Sivadasan found herself lighting firewood in her kitchen—a smell she associated with her grandmother’s era, not her own . In Mumbai’s crowded Sanpada suburb, queues began forming before dawn, empty cylinders clutched like lifelines . And in the central Indian town of Raisen, when a distribution agency failed to open on time, consumers blockaded the road in protest .This is not a story about a logistical glitch. This is the story of how a single global chokepoint—the Strait of Hormuz—reached across oceans and disrupted millions of Indian kitchens. Behind the long queues and the panic bookings lies a hidden vulnerability that policymakers knew about but never fully addressed. And as the crisis deepens, the government’s emergency measures reveal uncomfortable truths about just how exposed India remains.The 91% Vulnerability
Let us start with a number that should trouble every Indian household: 91 per cent.
That is the share of India’s liquefied petroleum gas (LPG) imports that traditionally transits through the Strait of Hormuz, a narrow maritime passage between Iran and Oman . Through this 21-mile-wide channel flows about 20 per cent of the world’s oil and a significant chunk of its gas. For India—the world’s second-largest LPG buyer—this strait is not just a shipping route; it is an arterial lifeline .
When the Israel-US-Iran conflict escalated in late February 2026, that lifeline kinked. Even without a formal closure of the strait, insurers began cancelling or repricing war-risk cover. Shippers grew reluctant to sail into harm’s way. By early March, satellite trackers observed an effective halt of traffic through the chokepoint .
The result was immediate and brutal. India imports about 60 per cent of its LPG consumption . With 85 to 90 per cent of that supply suddenly constrained, the mathematics turned cruel. Domestic LPG prices rose by ₹60 per 14.2-kg cylinder, pushing the retail price in Delhi to approximately ₹913 . Commercial cylinders, vital for restaurants and hotels, spiked by ₹115 .
But price hikes were only the beginning. The real story lies in what happened next.
The Panic and the Queues
By mid-March, long queues had become a fixture outside LPG distribution agencies across Delhi, Gurugram, Mumbai, and Bengaluru . Delivery boys told reporters that waiting times stretched to a week or more. Online booking systems buckled under the load. In some cities, desperate consumers turned to the black market, paying two or three times the official rate—up to 3,000 rupees for a single cylinder .
Government officials pleaded for calm. Joint Secretary Sujata Sharma assured the public that no "dry out" had been reported at any of India’s 25,000 distributors. But she acknowledged the uncomfortable truth: bookings had increased many-fold because of panic .
“There is a many-fold increase in bookings because of panic,” she told reporters .
The panic was not irrational. With memories of past shortages fresh in public memory, and with television screens beaming images of maritime attacks in the Gulf, consumers behaved exactly as one might expect: they stockpiled. And in stockpiling, they exacerbated the very shortage they feared.
The Commercial Sector: The Silent Victim
While household consumers queued and fretted, the commercial sector bled.
Hotels and restaurants, which rely on 19-kg commercial cylinders, found themselves at the back of the queue. The government invoked emergency powers under the Essential Commodities Act, prioritising household consumers over commercial establishments . A committee comprising executive directors from Indian Oil, Bharat Petroleum, and Hindustan Petroleum began reviewing allocations to restaurants and hotels, effectively rationing supply .
The impact on India’s hospitality sector was swift and brutal. In Mumbai and Bengaluru, restaurants began warning of potential shutdowns . In Navi Mumbai and Raigad districts, more than 20 per cent of hotels temporarily closed their doors . A Delhi restaurant owner told reporters he could serve only four to six dishes from a menu that once offered two dozen options . Another had spent two frantic days unable to secure a single cylinder .
The National Restaurant Association of India estimated that up to 5 per cent of formal restaurants had already shut . The knock-on effects rippled outward: food delivery platforms like Zomato and Swiggy, which depend heavily on non-chain restaurants, faced mounting risk
The Hidden Story: Why No LPG Reserves?
Amid the chaos, a quiet question began circulating among energy experts: why does India have strategic crude oil reserves but nothing comparable for LPG?
The answer reveals a policy gap that has quietly worsened over a decade of remarkable success.
India’s LPG story is, in many ways, a triumph. Driven by the Pradhan Mantri Ujjwala Yojana (PMUY), the number of LPG connections has surged from 149 million in 2015 to over 331 million by January 2026 . Cooking gas coverage is now near-universal. Consumption has grown from 21.6 million tonnes in FY17 to about 31.3 million tonnes in FY25 .
But this expansion was not matched by storage infrastructure. While India maintains strategic petroleum reserves capable of covering 9–10 days of crude oil demand, no such national buffer exists for LPG .
Why? The reasons are partly physical, partly financial, and partly a matter of policy inertia.
“LPG lacks a comparable policy due to storage and supply differences,” explained Nilanjan Banik, professor at Mahindra University’s School of Management. “As a pressurised propane-butane mix, LPG requires costly high-pressure or cryogenic facilities; unlike crude oil, which suits natural caverns” .
In plain English: storing LPG is hard and expensive. It cannot be tucked away in salt caverns like crude oil. It needs specialised tanks, constant pressure management, and careful safety protocols. Building a strategic reserve for even a few days of consumption would cost several billion US dollars .
Instead, India’s LPG system operates on a just-in-time distribution model. Bottling plants typically hold only 4–7 days of stock, with an all-India average of about six days. Including terminals and commercial inventories, total storage rises to around 22 days—far below the 74 days of cover available for crude oil .
This model works beautifully when supply chains flow uninterrupted. But when a chokepoint closes, just-in-time becomes just-too-late.
The Government’s Response: Band-Aids on a Fracture
Facing a mounting crisis, the government moved on multiple fronts.
On March 8, 2026, the Ministry directed all domestic refineries and petrochemical complexes to channel C3 and C4 streams toward LPG production and supply them exclusively to public sector oil companies . Domestic production increased by an estimated 30 per cent compared to the previous week .
On March 9, the government invoked the Essential Commodities Act to prioritise household and vehicle consumers over commercial users
To cushion the financial blow, the government approved ₹30,000 crore in compensation to oil marketing companies for supplying LPG at subsidised prices during FY2025-26 . This followed ₹40,000 crore in losses that OMCs had absorbed earlier to shield consumers from international price volatility .
And in a move freighted with historical irony, officials began exploring "alternative fuels" —a euphemism for kerosene, coal, and even biomass . Environmental rules were temporarily relaxed to permit the use of biomass and refuse-derived fuel pellets in the hospitality sector .
This last measure is particularly striking. For years, government policy has pushed Indians away from kerosene, coal, and firewood—fuels associated with indoor air pollution and respiratory illness. Now, in the space of weeks, those same fuels were being reactivated as emergency options.
The Geopolitical Chain Reaction
To understand why this crisis arrived with such force, one must look beyond the immediate conflict and examine the deeper supply architecture.
India’s LPG imports have long been concentrated in the Middle East. Historically, 85–90 per cent came from Gulf producers under contracts benchmarked to the Saudi Contract Price . This concentration made commercial sense—shorter shipping distances, established relationships, reliable quality. But it also created a single point of failure.
When the Strait of Hormuz became a conflict zone, that point failed.
The crisis was compounded by parallel shocks. Fertilizer production, which relies on natural gas as a feedstock, came under pressure as gas supplies tightened . Since domestic gas was being diverted to households, fertilizer output faced potential cuts—threatening the upcoming kharif season . Global LPG prices swung wildly, with crude oscillating from $71 to $117 per barrel before settling near $90 . The rupee weakened against the dollar, making imports more expensive.
It was, in essence, a perfect storm—one that revealed just how deeply India’s kitchen hearth is connected to global energy markets.
What the Government Isn’t Telling You
In official communications, the government has emphasised continuity: domestic LPG prices remain unchanged for household consumers, no dry-outs have been reported, and alternative supplies are being arranged .
All of this is technically true. But it is not the whole truth.
The whole truth includes these uncomfortable facts:
First, India’s LPG vulnerability was foreseeable and foreseen. Import dependence rose from 49 per cent to 60 per cent between FY17 and FY25, while domestic production grew at just one-third the rate of demand . The concentration of supply through Hormuz was well understood. Yet strategic reserves were never built.
Second, the burden of adjustment is falling unevenly. Household consumers have been protected—for now—but commercial users are bearing the brunt. Restaurants are closing. Hotels are cutting menus. Small eateries, which operate on thin margins and cannot absorb price shocks, face an existential threat .
Third, the government’s emergency measures involve rolling back environmental progress. Relaxing rules on kerosene and biomass may ease short-term pressure, but it also exposes millions to the health risks that past policies sought to eliminate .
Fourth, even with emergency powers, India’s supply chain remains fragile. The current stockpile of about 22 days (including commercial inventories) is modest by international standards . If the Hormuz disruption persists, or if producer countries extend force majeure declarations, those buffers will drain quickly.
The Long Road to Resilience
What would genuine energy security look like? Experts who spoke to ET EnergyWorld and Business Standard outlined a multi-layered strategy .
Diversification of sources is the most urgent priority. In November 2025, the Ministry announced India’s first structured US-sourced LPG import program—2.2 million metric tonnes per annum, or about 10 per cent of annual imports, benchmarked to Mont Belvieu rather than the Saudi CP . This was a start. But the goal should be to reduce the Middle East’s share from 90 per cent to closer to 50 per cent, sourcing instead from the US, Algeria, Norway, and potentially Russia .
Strategic storage must be rethought. While full-scale cavern storage for LPG remains technically challenging, experts have proposed more modest measures: mandating buffer stocks at import terminals, expanding floating storage via Very Large Gas Carriers, and creating a dedicated LPG reserve of 40–45 days .
Domestic production can be enhanced through technologies like Advanced Gas Recovery, which captures LPG that would otherwise be lost in refinery fuel systems .
And over the longer term, India must reduce its structural dependence on LPG itself. Expanding piped natural gas networks in urban areas (from the current 12.5 million households to a much larger base), promoting electric cooking as the grid stabilises, and scaling up biogas in rural areas can all moderate demand growth .
The Human Cost
Behind the policy debates and the supply chain analytics lie real human stories.
In Kerala, Babitha Sivadasan now cooks with firewood, conserving the dwindling gas in her cylinder for when she truly needs it . In a Mumbai high-rise, Kriti Mittal bought an induction cooktop—not because she preferred electric cooking, but because she wanted insurance against uncertainty . In Delhi, a restaurant owner watches his business crumble, unable to serve the dishes that once drew loyal customers .
Across India, retailers report a 30-fold surge in induction cooktop sales on some platforms . DMart stores struggle to keep electric cookers in stock. Consumers are adapting, as consumers always do, to a reality they never chose.
But adaptation is not resilience. And resilience is what India needs.
Conclusion: The Chokepoint Lesson
The Strait of Hormuz crisis will eventually pass. Shipping will resume, supply chains will normalise, and the long queues outside gas agencies will dissolve into memory. But the underlying vulnerability will remain unless India acts.
The uncomfortable truth is this: for all the remarkable success of schemes like PMUY, the infrastructure of supply did not keep pace with the expansion of demand. A nation that brought cooking gas to 330 million households did not simultaneously build the buffers to protect those households from global shocks.
That omission is now visible to everyone who has stood in a queue, paid a black-market price, or lit firewood in a modern kitchen.
The question is whether the memory of March 2026 will fade—or whether it will galvanise the kind of long-term planning that transforms vulnerability into strength. India’s kitchens deserve nothing less.