Countries around the world are facing serious difficulties as a result of the ongoing war between the United States and Iran. With the conflict severely affecting the Strait of Hormuz in particular, nations across the globe have found themselves grappling with disruptions to cooking gas supplies. India too experienced an unprecedented impact, with a shortage of cooking gas at one point forcing restaurants to shut down. Against this backdrop, the central government has taken a key decision aimed at preventing similar situations from arising in the future.
With tensions in West Asia showing no signs of easing anytime soon, indications suggest that gas shortages could recur going forward as well. To prevent such situations in the future, the government has moved to set clear targets, directing public and private sector refineries and oil exploration companies operating in the country to meet specific LPG production goals — something the government has never done before. Given the current situation, however, setting such targets has become unavoidable, with the government’s objective being to build up domestic reserves sufficient to meet the country’s needs as far as possible. In this regard, officials from the Ministry of Petroleum and Natural Gas recently issued orders to the relevant companies, setting a combined daily production target of 63,810 tonnes of LPG across 21 companies.
Domestic LPG consumption in India has grown significantly compared to the past, but the country’s reserves have not kept pace with this rising demand. The government had earlier encouraged the use of gas with the aim of curbing environmental pollution, leading to a sharp rise in cooking gas usage across households. In the 2025-26 financial year alone, India’s LPG consumption stood at 33.2 million tonnes, translating to an average daily consumption of around 91,000 tonnes. However, domestic production stood at just 13.1 million tonnes, or 35,900 tonnes per day, meaning the remaining 21.3 million tonnes (58,400 tonnes per day) had to be imported from abroad — leaving the country dependent on imports for 64 percent of its requirement.
India had never previously faced difficulties in importing gas. However, the closure of the Strait of Hormuz due to the US-Iran war had a direct impact, given that around 90 percent of the LPG India imports to meet domestic needs passes through this very strait. With this critical transport route shut down, the country faced a severe shortage of cooking gas. To prevent such difficulties from recurring, the government has directed refineries to immediately step up domestic production. Alongside this, it has also imposed restrictions on the sale of commercial cylinders and had to extend the booking window for domestic cylinders.
The government believes that avoiding such situations in the future will require a sufficient increase in domestic production. Accordingly, it has set LPG production targets for refineries and oil exploration companies. The Centre has set a combined daily production target of 31,470 tonnes for a total of 18 public sector refineries. In the private sector, Reliance has been given the highest target of 18,000 tonnes, followed by Nayara Energy at 4,480 tonnes, while Maharatna companies ONGC and GAIL have been directed to produce 6,460 tonnes. The government has stated that new targets will be set every six months, on January 1 and July 1, based on the country’s domestic requirements at the time.