To manage LPG shortages caused due to the Gulf crisis, the Indian government has decided to regulate commercial sale of liquefied petroleum gas in India, “with clear priorities and a transparent allocation mechanism”.

There was earlier no registration, booking, digital authentication or delivery confirmation mechanism for cylinders purchased in the open markets. A three-member committee comprising executive directors from oil marketing companies Indian Oil, HPCL and BPCL was constituted by the government on 9 March. Meetings have been held with state civil supply departments and restaurant associations with a plan to regulate the flow under a “transparent allocation mechanism”.

India produces about 90 million metric standard cubic metres of natural gas per day, domestically. But it imported around 60 per cent of its LPG requirements from Gulf nations such as Qatar, the UAE, Saudi Arabia, and Kuwait, while the remaining 40 per cent was produced domestically.

Procurement has been diversified since the war began, with additional cargoes secured from the US, Norway, Canada, Algeria and Russia alongside existing sources in the Gulf. Meanwhile, kerosene is being made available by the government through retail outlets and public distribution system channels, and fuel oil is being made available for industrial and commercial consumers.

An order has been passed under the Essential Commodities Act to establish a priority allocation framework in which all refineries must maximise LPG output and route hydrocarbon streams – comprising propane, butane, propylene, and butene – exclusively to oil marketing companies (OMCs) for domestic cooking gas supply.

Gas supply to households through piped connections and to vehicles using CNG will continue without any reduction. Hospitals and educational institutions are also being given priority, ensuring they receive an uninterrupted supply of gas.

However, industrial and manufacturing users will receive only up to 80 per cent of their average gas consumption from the past six months. Fertiliser plants will get up to 70 per cent of their earlier allocation, while refineries and petrochemical units are managing a controlled reduction in their gas use.

Crude oil supplies have been less impacted as sources from outside the Strait of Hormuz have increased to around 70 per cent of crude imports, compared to 55 per cent before the conflict began. India imports crude oil from 40 countries.

Indian Prime Minister Narendra Modi has asked state governments to monitor and stop black marketers and hoarders. “India must stand united behind the institutions managing this crisis, and behind the national interest. The record of preparation and the record of response speak for themselves,” said Minister of State for Petroleum Hardeep Singh Puri, while addressing the lower house of Parliament.

Shortages in fuel supply have distorted energy calculations of neigbouring countries too, with Pakistan having ordered all schools closed and asked workers to function from home for two weeks to cut fuel use and government spending. Bangladesh has had to shut its universities as part of its energy rationing and conservation measures.

“We appreciate the Ministry for establishing a 24/7 control room to monitor the supply and stock levels of petroleum products across the country,” said K.B. Kachru, President, Hotel Association of India. “We urge the government’s special consideration to treat our industry as an essential service and make arrangements to ensure supply without disruption to this sector,” he added.

There are reports of restaurant shutdown in pockets within India having an impact on workers in the gig economy.