India targets US for up to 25% of LPG imports by 2027
State refiners including Indian Oil, BPCL and HPCL are set to diversify LPG sourcing beyond the Middle East, with the US targeted for up to a quarter of shipments by 2027. The shift could influence household cooking-fuel availability and import-cost exposure.
What happened
Indian Oil Corporation · India plans to source up to 25% of LPG imports from the US by 2027 as state refiners diversify from Middle Eastern supply disruptions,
Key facts
- Up to 25% of LPG shipments to come from the US in 2027
- India imported 21.85 million tonnes of LPG in 2025
- About 90% of 2025 LPG imports came from the Middle East
- Imports accounted for about 66% of India's LPG use
- US LPG imports exceeded 1 million tonnes in June
- India's 2026 US LPG annual-contract target was 2.2 million tonnes
- January-June 2026 LPG use was about 14.7 million tonnes, down nearly 8% year-on-year
- January-June 2026 LPG imports fell nearly 28% to about 7.5 million tonnes
- 2026 LPG consumption is estimated at roughly 30 MT
- 2027 LPG demand is projected at roughly 31 MT, with imports near 20 MT
- India pledged to raise US energy purchases by $10 billion-$25 billion
- India-US bilateral trade target is $500 billion by 2030
Why this matters
Fuel distributors, logistics providers and retail-adjacent energy players may find partnership opportunities in expanded LPG import, storage and last-mile distribution capacity supporting US-origin supply.
What to watch
- Signed long-term LPG offtake agreements between Indian state refiners and US exporters
- Monthly Indian LPG import origin data and the US share of total cargoes
- Mont Belvieu-to-Arab Gulf LPG price spreads, tanker freight rates and USD/INR movement
- Red Sea, Hormuz or Panama Canal disruptions affecting voyage times and freight costs
- Domestic LPG cylinder price revisions and changes to PMUY or other consumer subsidy funding
- New or expanded LPG import-terminal, cavern-storage and bottling capacity approvals
- State refiners are likely to seek multi-year US LPG supply agreements and shipping arrangements before materially raising spot purchases.
- Import terminals and coastal storage operators may prioritize LPG handling capacity, blending flexibility and faster inland dispatch.
- The government may retain or expand targeted LPG subsidy support if higher freight or rupee weakness raises household cylinder costs.
- Retail LPG distributors may increase safety-stock planning ahead of seasonal demand peaks and periods of geopolitical shipping disruption.