‘An Alarming State of Affairs’: Conflict on Iran Tightens India's LPG Supplies.

The repercussions of a conflict being fought nearly 3,000km away are now being felt in India's homes.

As military actions on Iran hinder energy transports through the key maritime chokepoint, supplies of cooking gas are tightening across India, forcing restaurants to shorten food lists, shorten hours and in some cases shut down altogether.

Social media is flooded by video clips showing crowds outside LPG distributors across Indian cities and towns as concerns over fuel supplies grow. Businesses appear the most affected: the sharpest squeeze is in food service establishments.

"Conditions are critical. LPG simply isn't available," says a official of the a major restaurant body.

Most restaurants run either on industrial fuel canisters or piped gas, and the scarcities are now being experienced across the country. "Many restaurants have shut down - some in the capital, many in the southern states. People are adopting traditional burners and induction stoves to keep kitchens going."

Localized Effects

In a western metro, accounts say up to a fifth of hotels and restaurants are already operating at reduced capacity as commercial LPG supplies dry up. In the southern cities of Bangalore and Madras, some eateries say their gas stocks have dwindled with scarce alternatives. "We can only make coffee and no food items - it is extremely difficult. Operations will be impacted," says a chain proprietor in Bengaluru.

Restaurant managers are scrambling to adapt. "Offering lists are shrinking, some are skipping midday meals and operating solely in the evening," an industry representative says, adding that shutdowns are changing as supplies wax and wane. "A number of eateries in Delhi were shut yesterday - a couple are back in business. It's a dynamic scenario."

Retailers observe a spike in sales of electric cookers, with some saying they are running out of them.

Government Stance

Yet, the authorities insists there is no shortage.

India has more than 300 million household consumers and spokespersons say stocks are being prioritized to households as tensions from the Middle East conflict ripple through energy markets.

Roughly six out of ten of India's LPG is sourced from abroad, and about the vast majority of those shipments pass through the critical waterway, the narrow Gulf chokepoint now effectively closed by the conflict.

The relevant department says that it instructed refineries to maximise LPG output for domestic use, raising domestic production by about 25%. Non-domestic supply is being prioritised for vital industries such as healthcare and education, while distribution will be "equitable and clear".

"Unnecessary hoarding and stockpiling has been sparked by false reports. The standard supply timeline for domestic LPG remains about 60 hours," says a government spokesperson.

Widening Concern

Now the concern is extending beyond kitchens. On online networks, a widely shared video from Chennai shows a long, snaking queue of motorbikes outside a gas outlet. "Concern is genuine," the text reads.

According to data from market experts, concerns about India's broader fuel supplies may be exaggerated.

India imports 90% of its crude oil. Around a significant portion of its petroleum shipments - about 2.5 to 2.7 million barrels a day - travel through the waterway, largely from Gulf countries.

Even if crude flows through the Strait of Hormuz are hindered, the deficit could be partly compensated for by higher imports of competitively priced oil from Russia, according to a sector expert.

Based on vessel tracking and credible market sources, increased Russian crude imports could reach around a significant volume of barrels a day, lessening India's effective deficit from exposure to the Strait of Hormuz to about 1.6 million barrels a day.

"Tens of millions of Russian oil barrels are currently in transit at sea in the Indian Ocean and, with only two major Asian economies as major buyers, those barrels remain a available backup," an analyst noted.

Kitchen Fuel: The Primary Concern

The primary concern is LPG, analysts say.

India consumes roughly a million barrels a day, but produces only less than half domestically, importing the rest - the vast majority through the Strait.

Refineries can tweak operations to produce a bit more LPG, but even a moderate increase would only raise domestic supply to about under half of demand, leaving the country heavily reliant on imports.

In short: "Crude supply risk can be somewhat alleviated through alternative sourcing. Refined product supply remains largely sufficient. Kitchen fuel stocks is the critical issue to watch in the coming weeks."

What may be worsening the anxiety on the ground is not just limited availability but patchy deliveries - and the familiar spectre of hoarding.

An industry representative alleges price gouging.

"Retailers are misusing the situation - illegally trading canisters and selling them at a high cost. In one small town, I heard of cylinders being hoarded and sold to the highest bidder."

For now, India's petroleum stocks may be cushioned by international market dynamics. But in kitchens across the country, the more urgent issue is simple: how to get the next gas canister.