IOC lifts LPG output nearly 30% as Hormuz disruption tests fuel supply
Indian Oil Corporation raised LPG production by nearly 30% and ran refineries above capacity to sustain fuel availability amid Hormuz-related disruption. Q1 crude processing reached 19.17 million tonnes at 109.4% utilisation, while IOC advances refinery, petrochemical and renewable-energy expansion plans.
What happened
Indian Oil Corporation (IOC) · IOC increased LPG output nearly 30% and ran refineries above capacity to maintain Indian fuel supplies amid Hormuz disruption. It
Key facts
- LPG production increased nearly 30%
- Refineries operated above 100% utilisation
- Standalone FY2026 net profit: Rs 36,802 crore
- FY2026 turnover: about Rs 8.86 lakh crore
- Aggregate sales exceeded 105 million tonnes
- FY2026 crude processed: 75.45 million tonnes
- FY2026 domestic petroleum-product sales: 88.97 million tonnes
- Q1 crude processed: 19.17 million tonnes at 109.4% utilisation
- Q1 pipeline throughput: 28.55 million tonnes
- Domestic petroleum-product market share: 43.1%
- Refining capacity to rise from 80.75 million tonnes/year to about 98 million tonnes/year
- Petrochemical intensity target: about 15% by 2030
- Renewable capacity under development/preparation: 5.3 GW
Why this matters
The disruption reinforces the strategic value of IOC’s refinery, petrochemical and renewable-energy expansion pipeline as it broadens supply flexibility and reduces concentration risk.
What to watch
- Duration and severity of Hormuz shipping disruption, including vessel transit rates and insurance premiums.
- Indian crude import arrival schedules, refinery crude inventory days and IOC spot procurement activity.
- Domestic LPG bottling-plant utilisation, cylinder delivery lead times and reported distributor stockouts.
- Retail petrol and diesel station availability, queueing, rationing measures or regional allocation changes.
- Government decisions on fuel price pass-through, excise adjustments, LPG subsidy support or emergency stock releases.
- Crack spreads, LPG benchmarks, freight rates and IOC marketing margins relative to procurement costs.
- Unplanned refinery outages or maintenance deferrals caused by sustained operation above normal utilisation.
- Keep refineries at elevated utilisation where crude availability, maintenance reliability and product offtake permit.
- Build LPG, petrol, diesel and aviation-fuel inventories near high-demand retail and industrial markets.
- Diversify crude and LPG procurement toward non-Hormuz routes and secure additional shipping, storage and insurance capacity.
- Prioritise LPG cylinder distribution, transport fleets, agriculture and critical infrastructure if regional product availability tightens.
- Use higher throughput to improve retail fuel availability and defend market share, while monitoring marketing-margin pressure.
- Accelerate refinery integration, petrochemical yield flexibility and renewable-energy projects to reduce long-term exposure to imported fuel volatility.