India LPG demand slumps

India’s cooking gas squeeze is now showing up in places far from ports and refineries. In March 2026, India’s liquefied petroleum gas use fell to 2.38 million tonnes, down 15.7% from February and 13% from a year earlier, the lowest monthly level in 21 months. (thehindubusinessline.com) At the same time, people bought more road fuel, not less. Diesel consumption hit 8.73 million tonnes and petrol reached 3.78 million tonnes in March as drivers rushed to fill tanks during fears of supply disruption linked to the West Asia conflict. (thehindubusinessline.com) Liquefied petroleum gas is the bottled fuel used in millions of Indian kitchens, restaurants, workshops, and small factories. When fewer cylinders are available, the first effect is not abstract energy data but cold stoves, shorter work shifts, and businesses cutting hours. (ppac.gov.in) (timesofindia.indiatimes.com) New Delhi has responded by rationing, not by pretending every user can be served normally. The Petroleum Ministry this week kept packed non-domestic liquefied petroleum gas supply at 70% for priority industries and expanded eligibility to sectors such as ceramics, pharmaceuticals, and specialized manufacturing that cannot easily switch fuels. (thehindubusinessline.com) (finance.yahoo.com) That tells you where the shortage is biting. If the government is explicitly reserving cylinders for sectors with “limited substitution,” it means many other commercial users are being pushed to wait, pay more, or hunt for alternatives like piped gas, kerosene, coal, or biofuels. (finance.yahoo.com) (thehindubusinessline.com) Ludhiana shows what that looks like on the ground. The city’s main wholesale fruit and vegetable market reported a 30% slump in business as an acute cooking gas shortage and a labour crunch disrupted the fresh-food supply chain. (timesofindia.indiatimes.com) The labour problem and the gas problem are feeding each other. The Times of India reported that workers in Ludhiana have been leaving the city during the shortage, and earlier this month it described a wider exodus of migrant labour from the industrial hub as rising living costs and fuel scarcity hit daily life. (timesofindia.indiatimes.com 1) (timesofindia.indiatimes.com 2) The March numbers also show this is not a general slowdown in energy use. Total petroleum product consumption rose to 21.37 million metric tonnes in March from 20.19 million in February, so India was using more fuel overall even as cooking gas sales dropped. (thehindubusinessline.com) (ppac.gov.in) That gap matters because it separates panic buying from physical constraint. Motorists could queue and fill up immediately, but households, eateries, and small businesses that depend on cylinders were stuck waiting for a fuel that arrives through a tighter chain of imports, bottling, and local delivery. (thehindubusinessline.com 1) (thehindubusinessline.com 2) India is the world’s third-largest liquefied petroleum gas consumer, so even a one-month drop of this size is hard to hide. By April 2026, the shortage had moved from energy desks into vegetable markets, restaurant kitchens, factory floors, and wage disputes, which is usually when a fuel story becomes an economy story. (thehindubusinessline.com) (timesofindia.indiatimes.com)