In a significant move towards bolstering energy security, India has inked its first structured agreement to import liquefied petroleum gas (LPG) from the United States. This one-year contract, set to commence in 2026, aims to supply approximately 2.2 million tonnes per annum, fulfilling nearly 10% of India's total LPG import needs. This marks a pivotal diversification in India's energy sourcing strategy.
The Union Petroleum Minister hailed this development as a milestone for India's burgeoning LPG market. This agreement paves the way for long-term partnerships with US suppliers, underscoring India's commitment to securing stable, affordable, and diversified LPG supplies for its domestic households.
Public sector undertakings Indian Oil, Bharat Petroleum, and Hindustan Petroleum collaborated with major American producers during recent visits to the United States. Their concerted efforts resulted in the first structured long-term contract for US-origin LPG. The pricing mechanism is anchored to the Mount Belvieu hub, enhancing transparency and stability in procurement.
This deal is seen as a crucial element in shielding households from global price fluctuations. Despite a more than 60% surge in international LPG prices last year, targeted support ensured that beneficiaries of welfare schemes continued to pay significantly below market rates. The new arrangement strengthens ongoing efforts to maintain reliable supply for millions of families.
This agreement highlights India's status as one of the largest and fastest-growing LPG markets globally. It strengthens long-term diversification efforts, enhances resilience against price shocks, and deepens energy cooperation with the United States, thereby contributing to secure and affordable LPG access across the nation.
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