India's LPG consumption grows 44 pc to 31.2 MMT between FY17-FY25
New Delhi, Nov 26
Liquefied petroleum gas (LPG) consumption in India grew over 44 per cent to 31.3 million metric tons (MMT) in fiscal 2025 from 21.6 MMT in fiscal 2017 and is projected to touch 33-34 MMT in fiscal 2026, riding on widespread household access and increasing refill intensity, a report said on Wednesday.
The average household LPG refills for Pradhan Mantri Ujjwala Yojana (PMUY) beneficiaries have risen to 4.5 per household per year in fiscal 2025 from 3.9 cylinders in fiscal 2017, fuelled by better affordability, improved delivery networks, and increasing reliance on LPG for everyday cooking energy needs.
Non-Ujjwala households have maintained refill levels of 6-7 cylinders per household per year across the past five fiscal years.
"The share of LPG used for commercial and industrial purposes has risen to 16 per cent in fiscal 2025 from 10 per cent of total LPG demand in fiscal 2017, driven by rising adoption in food services, institutional kitchens and small manufacturing clusters, broadening the demand base and mitigating traditional seasonal fluctuations observed in household consumption," Crisil Ratings said in its report.
Domestic LPG production has edged up to 12.8 MMT in fiscal 2025 from 11.2 MMT in fiscal 2017, but this incremental increase in supply has failed to keep pace with the robust growth in national demand.
Consequently, the domestic contribution to overall LPG availability has weakened over time.
According to the report, India’s LPG market remains heavily reliant on imports, with 55-60 per cent of demand met through imports over the past decade, despite steady domestic production growth.
The recent India-US LPG agreement, involving 2.2 million tonne per annum of long-term volume, signifies a notable shift in supplier diversification, reducing historical reliance on Middle Eastern producers.
"While the strategic advantages of the deal are substantial, landed cost sensitivities linked to freight could shape the economics of oil marketing companies in the near term," the report stated.
— IANS
Reader Comments
Good progress but concerned about 55-60% import dependency. We need to focus more on domestic production and alternative energy sources. The US deal is strategic but we shouldn't become too dependent on any single source.
The commercial sector growth to 16% is interesting. Many small restaurants and dhabas in our area have switched to LPG from traditional fuels. Much cleaner and more efficient for business operations.
While the growth numbers look impressive, the price of cylinders keeps increasing every few months. Many poor families still find it expensive and sometimes go back to using firewood. Government should consider better subsidies for genuine poor households.
The delivery network improvement mentioned in the article is real. In our tier-2 city, we get cylinder delivery within 2-3 hours of booking compared to 2-3 days earlier. Digital payments have made the process much smoother too.
As someone who works in energy sector, the diversification from Middle East to US suppliers is a smart move geopolitically. But the freight cost sensitivity mentioned could affect OMC margins. Hope they manage this well to keep prices stable for consumers. 🤞
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