India’s cooking gas (LPG) consumption witnessed a sharp decline of nearly 13% in March 2026, dropping to 2.379 million tonnes from 2.729 million tonnes a year earlier. This slump is primarily attributed to severe supply chain disruptions caused by the escalating West Asia conflict, which impacted imports through the critical Strait of Hormuz.
1. Sector-Wise Consumption Drop (March 2026)
To manage the supply crunch, the government prioritized domestic kitchens, causing the commercial and industrial sectors to bear the brunt of the shortage.
| Segment | YoY Decline (%) | March 2026 Volume |
| Bulk LPG Sales | -75.5% | Sharpest fall (Industrial use) |
| Non-Domestic (Commercial) | ~-48% | Hotels, restaurants, and caterers |
| Domestic Households | -8.1% | 2.219 million tonnes |
| Total LPG Consumption | -12.8% | 2.379 million tonnes |
2. Primary Causes: The West Asia Crisis
India is heavily dependent on imports for approximately 60% of its LPG requirements, most of which are sourced from Saudi Arabia and the UAE.
- Strait of Hormuz Blockade: Following US and Israeli strikes on Iran and subsequent retaliation, the Strait was effectively shut or restricted multiple times in March 2026, stalling India-bound tankers.
- Vessel Attacks: At least two India-bound LPG vessels were reportedly attacked, while 12 others were forced to turn back, leading to a massive backlog in the supply chain.
- Supply Rationing: Faced with constrained stocks, the Centre curtailed supplies to commercial establishments (hotels and small industries) to safeguard the availability of 14.2kg cylinders for households.
3. Government Mitigation & Production Boost
To offset the import shortfall, the Ministry of Petroleum and Natural Gas directed domestic refineries to prioritize LPG production over other petrochemical feedstocks.
- Domestic Output Surge: Local LPG production rose to 1.4 million tonnes in March, up from 1.1 million tonnes a year ago.
- Total FY26 Outlook: Despite the March slump, overall LPG consumption for the full fiscal year (FY25-26) still rose by 6%, reaching 33.212 million tonnes, reflecting the long-term trend of cleaner fuel adoption.
4. Comparison with Other Fuels
While LPG and ATF (Aviation Turbine Fuel) were hit by the war, transport fuels showed surprising resilience in March 2026.
- Diesel: Consumed 8.727 million tonnes (+8.1% YoY).
- Petrol: Consumed 3.78 million tonnes (+7.6% YoY).
- ATF: Remained flat at 807,000 tonnes, as war-disrupted flight routes led to higher fuel burn on rerouted paths, offsetting the drop in overall flights.
