Mumbai Hotels Face Shutdown as LPG Shortage Crisis Hits Food Industry

"The shortage of commercial LPG has become extremely serious over the past week, with intermittent disruptions escalating into a near-complete halt in supply in several regions since yesterday. Following the 5th March notification by the Ministry of Petroleum and Natural Gas, there has been considerable confusion among suppliers and distributors, many of whom have stopped supplying commercial LPG cylinders to hotels, restaurants and food service establishments," Shetty said.

He further added that they are receiving reports of severe shortages from cities including Mumbai, Pune, Aurangabad and Nagpur, while similar disruptions are being reported in states such as Delhi, Karnataka, Telangana and Andhra Pradesh.

"We are already receiving reports of severe shortages from cities including Mumbai, Pune, Aurangabad and Nagpur, while similar disruptions are being reported in States such as Delhi, Karnataka, Telangana and Andhra Pradesh. If the situation does not improve within the next two days, nearly 50 per cent of hotels and restaurants in Mumbai may be forced to temporarily shut operations depending on the stock of cylinders they currently have," he added.

He later said, "This will especially affect international tourists, both those who are already here and those who will be visiting the country. Also, smaller and medium-sized eateries will be the first to be impacted, as they typically operate with limited reserves."

However, Indane gas godown incharge from Ranchi, Ravi Kant, refuted claims of a shortage, attributing the disruptions to logistical delays during the Holi festival.

"There is no such shortage. Everyone needs to be patient. What happens during Holi is that the plant is not operational for two days. The drivers come back after four or five days. Now, everything will be back to normal in a day or two. We have plenty of supplies. Vehicles were not coming because of the drivers. It is just that there is a rumour that gas is not coming. Gas is sufficient," he told ANI.

Furthermore, Uttar Pradesh District Supply Officer Vimal Shukla said that the gas cylinder booking interval has been increased from 21 days to 25 days amid commercial LPG cylinder shortage.

"We do not have any scarcity of gas here... Here, we have 40 gas agencies, and it is functioning normally... It has been decided by the companies that 80% of gas bookings will be done through OTP... The consumers who are not receiving OTP have been instructed to do KYC and update the mobile number because every booking will be done through mobile number and OTP... The gas cylinder booking interval has been increased from 21 days to 25 days," he told reporters.

Speaking to ANI, Lucknow Hotel Associate member Jitendra Kumar Singh said that they have inquired about Gas suppliers and got to know that "there was indeed a scarcity."

"In Lucknow, we have not yet faced any scarcity of cylinders yet. After hearing the news of Bengaluru hotels closing, we inquired our Gas suppliers and got to know that there is indeed a scarcity... We have started its makeshift arrangement by going towards induction and green gas for the time being. It is a matter of concern because it is difficult to run a commercial hotel without the gas supply," he said.

The remarks come amid shortage of commercial LPG cylinders in several areas following the West Asia crisis and raised concerns among restaurant owners, hotel operators and other businesses that rely heavily on gas supplies for daily operations.

Meanwhile, a government source said the Liquefied Natural Gas (LNG) supplies to Asia are unlikely to face long-term disruption despite recent geopolitical tensions and shipping challenges in West Asia, although delays in deliveries are inevitable.

"So, in the long run, the supplies are not going to be disrupted, I am sure. But there is going to be a lead time. You can't help it," the government source said.

The source said the recent surge in Asian LNG prices and supply disruptions have altered the economics of global gas trade, making shipments from more distant suppliers commercially viable despite higher transportation costs.

"Now, the Asian price has gone up to 15, and the production has also stopped. Once the Asian price goes beyond 10, the import of gas from the US or Norway starts making sense even with the higher transportation cost," the source said.

India imports a large portion of its natural gas needs through LNG, much of which is tied to long-term contracts. A significant share of these imports comes from Qatar, traditionally a low-cost supplier for Asian markets.

- ANI