Page 53 - Policy Economic Report- June'26

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

5. Government Restores Non-Domestic packed LPG Supplies to Pre-Crisis Levels; Sectoral Supply
Restrictions Withdrawn

In a major relief to industrial and commercial LPG consumers, Government has removed all sectoral
restrictions on the supply of Non-Domestic Packed LPG and restored supplies to the levels prevailing prior
to the West Asia crisis. Further, the supply of bulk LPG, which had been suspended at the onset of the
crisis, has been relaxed by 50% of the pre-crisis consumption levels providing significant relief to
commercial and industrial consumers. The restoration follows the recent improvement in the LPG supply
situation.

During the West- Asia crisis, to augment domestic LPG production, the Government had issued orders
under the Essential Commodities Act requiring C3-C4 streams to be utilised exclusively for LPG production,
diverting them from petrochemical and other downstream uses.

Taking note of the improved indigenous LPG production and the projected availability of imported LPG
cargoes, Government has also decided to reduce the diversion of C3/C4 streams to LPG pool.

The enhanced allocation of C3-C4 streams for non-LPG uses will be implemented while ensuring that the
domestic LPG availability remains unaffected and aggregate indigenous LPG production is maintained at
not less than 40 TMT per day.

Centre of High Technology under the ministry has been directed to issue organisation wise allocation of
this enhanced C3/C4 streams for the petrochemical and other critical sectors and submit regular reports
to the Ministry.

Since the onset of global supply disruptions arising from the West Asia crisis, Government has accorded
the highest priority to ensuring uninterrupted availability of LPG to domestic consumers across the
country. In line with this, temporary restrictions were imposed on the supply of commercial packed LPG.
The timely policy interventions and coordinated efforts by Oil Marketing Companies (OMCs) helped
maintain stable supplies despite challenging global supply chains.

The Government has directed Oil Marketing Companies to continue maintaining comprehensive data on
commercial and industrial LPG consumers to facilitate efficient planning and supply management. A
unified sectoral database will also be maintained across the OMCs to strengthen monitoring and
operational coordination.

At the same time, the Government remains committed to expanding PNG connectivity. Commercial and
bulk consumers who have already shifted to Piped Natural Gas (PNG) will continue to remain on PNG.
Other eligible LPG consumers having access to the PNG network, or those in the process of shifting to
PNG, will be progressively transitioned to PNG in coordination with City Gas Distribution (CGD) entities.

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