LPG Crisis in India: 50% Restaurants May Shut in 2 Days, Government Invokes Essential Commodities Act — All You Need to Know
LPG Crisis 2026: Why India's Restaurants Are Shutting Down and What the Government Is Doing
India is staring at a cooking gas emergency. What began as a geopolitical crisis thousands of kilometres away in the Middle East has now entered every Indian kitchen, restaurant, and dhaba — and it is getting worse by the hour.
How It Started: The Strait of Hormuz Choke Point
The Middle East conflict involving Iran, Israel and the US has majorly disrupted energy shipping routes in the Gulf, directly affecting LPG exports from countries like Qatar and Saudi Arabia. INDmoney
India is one of the world's largest LPG consumers, and in 2025, over 91% of its LPG imports came from this region. The Strait of Hormuz — a narrow maritime chokepoint — is the primary route for these shipments. With military activities intensifying, shipping has slowed, insurance costs have risen, and tanker movements have been delayed. Weekly LPG imports are estimated to have fallen by nearly 30%. Investing.com
Ground Reality: Restaurants and Dhabas Running Dry
The NRAI, which represents over 500,000 restaurants across India with a combined annual turnover of over ₹5.7 lakh crore and 8 million employees, has sounded the alarm — 90% of India's restaurants rely on LPG cylinders to run their kitchens. Long Forecast
Commercial LPG cylinder supplies have reportedly come to a complete halt in several cities. In Vijayawada, one distributor reported 350 pending orders unmet and 200 new ones piling up daily. Yahoo Finance
In Mumbai, an estimated 20% of hotels have already closed. In Kolkata, food businesses are scrambling for alternatives. In Bengaluru, the Hotels Association warned that most gas companies have stopped supplying commercial cylinders entirely. Investing.com
In Rajasthan, oil marketing companies have directed distributors to halt new bookings for commercial LPG cylinders altogether. Yahoo Finance
The Hotel and Restaurant Association says the shortage could force 50% of hotels and restaurants across several cities to shut operations within two days. Dhan
What the Government Has Done
The government invoked the Natural Gas (Supply Regulation) Order 2026, establishing four priority sectors: piped natural gas for households, CNG for public transport, LPG production for domestic consumers, and essential pipeline operations. Enrich Money
The Government of India also invoked the Essential Commodities Act, 1955, to regulate the availability, supply and equitable distribution of petroleum and petroleum products. TRADING ECONOMICS
The Centre has simultaneously issued a mandatory 25-day inter-booking gap for domestic consumers to prevent hoarding. Oil marketing companies have also started rationing commercial LPG supplies. A three-member Executive Director committee has been formed specifically to review supply requests from the hospitality sector. Yahoo Finance
Madhya Pradesh CM Mohan Yadav convened an emergency review meeting. Chhattisgarh CM Vishnu Deo Sai directed district officials to crack down on black marketing. Yahoo Finance
Price Hike: How Much More Are You Paying?
The 14.2 kg non-subsidised domestic cylinder has been hiked by ₹60, now at ₹913 in Delhi. The 19 kg commercial cylinder has surged by ₹115. Black market prices are being reported as much higher — particularly in tier-2 and tier-3 cities. Investing.com
Political Angle: Opposition Pounces
Karnataka Minister Priyank Kharge squarely blamed the crisis on India's foreign policy, saying: "It is the outcome of Vishwaguru's foreign policies. The government said we have 75 days' stock — today they've invoked the Essential Services Maintenance Act, which is only used when there's a crisis." Yahoo Finance
With five state assembly elections due in the first half of 2026 — Assam, Tamil Nadu, Kerala, West Bengal and Puducherry — the LPG crisis has turned into a politically explosive issue overnight.
What Happens Next?
If the Iran war continues and Hormuz traffic does not normalise within the next week, India faces:
Mass restaurant and dhaba shutdowns across major cities
Accelerating black market for domestic cylinders
Food inflation due to higher cooking costs
Political crisis ahead of state elections
The only relief: if US-Iran tensions ease and tanker traffic resumes, supply could stabilise within 10–14 days.
Disclaimer: This article is for informational purposes only.
