West Asia Turmoil: India raises LPG prices a day after invoking emergency powers to boost production

India on Saturday raised the price of cooking gas by ₹60 per cylinder for both PMUY and non-PMUY users as the world’s third largest liquefied petroleum gas (LPG) consumer navigates a complex scenario of rising prices coupled with lack of cargoes from its main suppliers in West Asia, a region on the brink of a full blown war.

The price hike—second in the current financial year—comes at a time when when the world’s second largest LPG importer is scrambling to secure cargoes from the US and Canada, while invoking emergency powers back home directing refiners to maximise production of the critical cooking fuel used by more than 33 crore consumers, including over 10 crore PM Ujjwala Yojna (PMUY) beneficiaries.

Effective Saturday, non-PMUY consumers will have to shell out ₹913 for a 14.2-kg cylinder in Delhi. PMUY consumers will have to pay ₹613 per cylinder.

Breaking down the ₹60 per cylinder price hike for both PMUY and non-PMUY consumers, a top source said it translates to roughly 80 paise per family per day for cooking, or around 20 paise per person per day (for a family of four).

Besides, commercial LPG prices largely reflect prevailing international market conditions. They act as a market indicator of the global LPG price trend, the same source added.

The government also raised the price of commercial LPG—used by hotels and restaurants—by ₹114.5 per 19-kg cylinder to Rs 1,883 in Delhi.

Halt at Hormuz

Government sources said the price rise reflects the conflict in West Asia, which led to the closure of the Strait of Hormuz. India consumed more than 33 million tonne of LPG in FY25, of which over half was imported. Of this, 85-90 per cent came from West Asia with most cargo transiting the Strait.

Middle East Gulf (MEG), excluding Iran, is India’s largest supplier of LPG, covering 92 per cent (around 720,000 barrels per day) imports as of 2025, as per Vortexa. Maritime consultancy Drewry pegs that nearly 40 per cent of the global LPG supply passes through the 34 km narrow passage annually.

The government is exploiting all possible sources to get fresh supplies, some of which are expected by March-end. Besides buying 10 per cent of its LPG imports from the US, India is also in touch with Canada to procure LPG. Africa is another region that India can exploit for additional cargoes.

Shielding consumers

On rationale behind the price hike, sources said that it is important to view it in context of the current geopolitical scenario and the resultant LPG price movements, as well as the sustained efforts of the government to shield households from international volatility.

For instance, the average Saudi CP was around $575 per tonne from March 2024 to March 2026 (fluctuating from $636/tonne in March 2024, falling to $466 in November 2025, and then rising to $542 in March 2026). However, the domestic LPG (PMUY) prices have largely remained at ₹503-553 level.

Domestic LPG prices continue to remain below market-linked levels. For example, the market-determined price of a 14.2 kg cylinder in Delhi in March 2026 was around ₹987, while it was being sold to consumers at ₹853, roughly ₹134 lower than market price. Pricing calculations indicate that the required increase should be around ₹134 per cylinder, yet the government approved only ₹60.

For PMUY beneficiaries, the impact on household cooking expenses remains modest. The estimated cost of cooking per day per household increased from about ₹7.31 to ₹8.11, an increase of less than ₹1 per day.

While the average Saudi CP rose by 41 per cent from $385/tonne in July 2023 to $542 in March 2026, the effective price for domestic LPG (PMUY) has been reduced by about 32 per cent, from ₹903 per cylinder (14.2 kg) in August 2023 to ₹613 in March 2026.

Published on March 7, 2026