But the loading data, a barometer of receipts, signals reduced flows in April, and even lower in May, over those in February because of issues in shipping and fuel availability, senior officials said and the shipping data showed.
Lower receipts may extend rationing for a third month, with the allocation and cuts dependent on how much LPG is received, officials said.
India needs 1.6 million-1.7 million tonnes of imported LPG every month, the oil-ministry data showed. But loadings of LPG in March, for delivery in India in March and April, totalled only around 630,000 tonnes, less than a third of the 2.2 million tonnes loaded in February, the Kpler data showed. (The government is adjusting the rationing of the fuel, depending on receipts, an official in the refining sector said.)
As of today, the ship-tracking data showed that India in April received 355,000 tonnes, including the first two instalments of petroleum cargo from Iran since 2019.
The Luma, carrying 11,000 tonnes from Iran, landed March 31, and the Sea Bird, carrying 43,000 tonnes, came on April 2, the data from Kpler indicates.
The United States (US) will supply another six cargoes of a combined 300,000 tonnes in the next three weeks of April, to be delivered to oil-marketing companies (OMCs) and private importers.
“For deliveries in April, loadings from places other than West Asia must be completed by the first week of the month,” a shipping analyst said.
May receipts are skimpier. The US has loaded only one cargo -- of 49,000 tonnes -- in the week that began on March 30 for delivery in May. This is half its typical weekly loadings in February, according to Business Standard calculations based on the Kpler data.
India has an agreement with the US on supplies of 2 million tonnes this year under an annual term contract. That is equivalent to 10 per cent of India’s overall imports.
There is still time for cargo to be loaded this month to arrive in May but no new tenders were issued by Indian refiners for import from the spot market, according to trading sources.
A senior official in a state refiner said the LPG market in the US, the biggest producer in the world, was governed largely by term contracts, leaving little for spot purchases.
Shipping is the biggest obstacle in sourcing fuels, two senior traders said. Sellers in West Asia, including Iraq, the United Arab Emirates, and Saudi Arabia, have told Indian refiners to send their own ships to pick up LPG and oil cargo and negotiate with Iran for access to the Strait of Hormuz, traders said.
Sellers are not taking responsibility. But Indian shippers and crew refuse to make the voyage even after western insurers offer war-risk cover for the commodity and the tanker, another refining official said.
As a result, eight LPG tankers, which made their way to India under Iran’s security umbrella in March and April to deliver cargo, accounting for three-four days of consumption, are stranded in India in ballast mode after discharge.
Unless the tankers head back to West Asia and cross the strait, India cannot receive cargo for May. Of the eight, five landed this month and the rest in March, carrying West Asian supplies, the ship-tracking data accessed by Business Standard showed. India is also in talks with Iran to release the VLGC Sarv Shakti, the final stranded tanker carrying 46,400 tonnes of LPG, an official with a refiner said.
Also, affordability stays an issue, with the latest Saudi contract prices, a benchmark for India’s LPG pricing, rising by over half in the month, reaching a four-year high.
“Pricing is not an issue, only availability is,” the official said.
India imported 1.13 million tonnes of LPG in March compared to 2 million tonnes in February and 2.25 million tonnes in January, according to Kpler. Attacks by the US and Israel on Iran on February 28 led to Indian LPG imports crashing by 44 per cent in March.
India imports over 60 per cent of its annual LPG consumption of 33 million tonnes. Of that around 85 per cent comes from West Asia and is routed through the Strait of Hormuz.
“All efforts have been made to increase domestic LPG production. But there is a limit to it. Then, we have prioritised domestic consumers by giving gas to kitchens first, and we have increased commercial LPG to industries in a calibrated way,” Oil Ministry Joint Secretary Sujata Sharma said in a briefing.
The government has said LPG imports will be increased.
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