The increased US shipments are expected to meet 10pc of India's import needs, eating into the Mideast Gulf's traditional dominance, writes Rituparna Ghosh
India's state-controlled refiners have begun receiving the first term supplies of US LPG this month under the contracts signed in November last year following trade negotiations between the two countries and as India looks to reduce its dependency on imports from the Middle East.
India's HPCL received a23,000t evenly split propane-butane cargo on board the VLGC BW Var at the Vishakhapatnam refinery on 19 January, having been shipped by US refiner and midstream firm Phillips 66 from the company's Freeport terminal on the US Gulf coast on 8 December. This was preceded by India's IOC receiving a similar 22,100t shipment on the VLGC Hellas Hercules at Ennore on 17 January, from Chevron through midstream operator Targa's Houston terminal on 9 December, ship tracking data from Kpler show.
These imports are part of the 337,000t of US LPG that India is forecast to receive this month, compared with zero a year earlier, Kpler data show. IOC, HPCL and peer BPCL are contracted to receive 2.2mn t of US LPG combined over the course of 2026 from Phillips 66, Chevron and TotalEnergies, which will meet around 10pc of India's import needs.
India received nearly 1.6mn t of LPG from the US last year, around 13 times higher than its intake in 2024, largely owing to redirected US trade following Beijing's introduction of a 10pc tariff on US goods. This lifted the US' share of India's import market to 6.7pc, with India bringing in a record high 23mn t in 2025, while supplies from the Middle East still dominated but dropped to a 92pc share from 99pc in 2024, Kpler data show. Imports from the Middle East are forecast to exceed 2mn t in January, up from 1.78mn t a year earlier.
The pipes are calling
Indian LPG importers have been bringing in more supply since December in anticipation of the commissioning of the 2,800km Kandla-Gorakhpur LPG pipeline. The line is reportedly already operating in Gujarat state — before it passes through Madhya Pradesh and Uttar Pradesh — and the official commissioning could happen in late February once LPG reaches Gorakhpur, according to sources.
Indian LPG importers continue to eye cargoes on the spot market. HPCL secured 2-3 cargoes for delivery until March and issued another tender to buy one cargo for delivery over February-April. Tight prompt spot cargo availability has lifted fob Mideast Gulf prices, with traders paying up to $50/t above state-controlled Saudi Aramco's January contract price (CP) compared with premiums of $25-30/t at the start of the January trading period. Premiums to February CP paper for February deliveries were assessed at $29/t.
India's LPG demand exceeded 3mn t for the first time in December, lifting consumption by 7pc on the year to 33.1mn t over the course of 2025, the latest oil ministry data show.
