The ongoing conflict in the Middle East—involving Iran, the U.S., and Israel—is severely disrupting India’s LPG supply chain. Damage to Qatar’s ‘Ras Laffan’ LNG facility and the de facto blockade of the Strait of Hormuz have sent global energy prices soaring, directly impacting India, which imports a significant portion of its gas needs.

The Black Market Surge: While official prices for domestic cylinders remain around ₹900, the acute supply shortage has created a black market where cylinders are being sold for up to ₹5,000. Small businesses, particularly restaurants, are the hardest hit, facing operational paralysis due to the scarcity of commercial cylinders.

Why the Shortage?

• Global Price Explosion: Asian spot LNG prices have jumped from $10.5 per mmbtu to over $25 due to supply fears.
• Logistical Bottleneck: With 55-65% of India’s LNG imports passing through the Strait of Hormuz, the disruption in this trade route has severely hampered arrivals.
• Dependence: As a major importer, India is highly vulnerable to geopolitical instability in the Middle East, which supplies 35-40% of its LNG requirements.

Government officials claim this is a temporary shortfall and are working to increase imports and streamline distribution. However, analysts warn that if the regional instability persists, availability may remain tight in the coming weeks.