LPG Prices Steady in India: June 24 Update

The LPG prices in India have remained unchanged as of June 24, with both domestic and commercial cylinder rates steady. This stability comes despite fluctuations in global oil prices, which have eased recently due to progress in US-Iran peace talks. The last price hike on June 7 saw the cost of a 14.2 kg domestic cylinder increase by ₹29, primarily due to severe under recoveries faced by oil marketing companies (OMCs). This was the second price increase in just three months.

For commercial consumers, a 19-kg cylinder witnessed a significant price surge of around ₹42. This increase is driven by rising energy costs and supply disruptions linked to the Strait of Hormuz transit route. In fact, the cost of commercial cylinders has escalated by nearly 79% over the last four months, reflecting the Saudi Contract Price (CP) set by Saudi Aramco each month.

In a recent media briefing, the Ministry of External Affairs (MEA) announced that a total of eleven ships bound for India successfully transited through the Strait of Hormuz after a peace deal was signed between the US and Iran. These vessels include three Indian-flagged crude oil tankers and a foreign-flagged LPG carrier, indicating a positive trend for energy supply to India.

India's LPG imports from the US are projected to reach a record high of 1 million metric tons in June. Concurrently, supplies from the United Arab Emirates have started to recover, with estimates of around 300,000 to 400,000 tons this month. This diversification in sources is crucial, especially as India had heavily relied on West Asia for LPG imports, with nearly 90% of its gas flowing through this trade route.

Despite efforts to diversify and seek alternative markets during disruptions, challenges remain. Pulkit Agarwal, Head of India Content at S&P Global Energy, emphasized that while the Middle East continues to be a reliable source of LPG, physical limitations hinder India's ability to fully replace reduced supplies from this region. The ongoing geopolitical dynamics will undoubtedly influence future trends in LPG pricing and availability in India.

As consumers and businesses navigate these changes, staying informed about LPG prices and market trends remains essential. The government and OMCs are likely to continue monitoring the situation closely, especially as global oil dynamics evolve.