India’s First Major LPG Import Deal with the US
19.11.2025
India’s First Major LPG Import Deal with the US
Context
India has finalised its first structured LPG import contract with the United States, securing 2.2 million tonnes per annum (MTPA), around 10% of annual LPG imports—for the year 2026. The move aims to diversify suppliers and enhance energy security.
About the Deal
What the Deal Is
• A one-year structured contract for Indian PSU refiners to import 2 MTPA of LPG from the US Gulf Coast in 2026.
• Marks India’s first formal long-term LPG sourcing agreement with the US.
Nations and Entities Involved
• India: Indian Oil Corporation (IOC), Bharat Petroleum (BPCL), Hindustan Petroleum (HPCL)
• United States: Gulf Coast LPG producers including Chevron, Phillips 66, and TotalEnergies Trading
Objectives
• Diversify LPG sourcing beyond West Asian suppliers.
• Strengthen India–US energy partnership and trade ties.
• Improve energy security and reduce supply risks.
India’s LPG Import Profile
• India imports roughly 60% of its LPG demand, totaling around 21 million tonnes in 2024.
• 90% of imports traditionally come from West Asia (UAE, Qatar, Saudi Arabia, Kuwait).
• India is among the fastest-growing LPG markets, driven by schemes like Ujjwala.
Key Features of the Agreement
• Quantity: 2.2 MTPA (~10% of annual LPG imports).
• Benchmark pricing: US Mont Belvieu LPG prices.
• Suppliers: Chevron, Phillips 66, and TotalEnergies Trading.
• Contract duration: Year 2026.
Significance
• Establishes a new energy trade corridor between India and the US.
• Reduces overreliance on West Asian LPG suppliers.
• Supports strategic and trade relations, including tariff negotiations.
• Enhances energy security against geopolitical risks and potential supply shocks.
Conclusion
India’s first major LPG import deal with the US marks a significant step in energy diversification and strategic cooperation. It strengthens bilateral ties, reduces regional dependency, and ensures stable LPG supplies for a rapidly growing domestic market.