Commercial LPG shortage begins hitting India’s hospitality industry
Restaurant associations have warned that many eateries could be forced to shut down within days if supply chains are not immediately restored.
India has set up a committee to examine supply issues after a sudden shortage of commercial LPG cylinders, caused by the West Asia war, alarmed the hospitality sector.
Restaurant associations have warned that many eateries could be forced to shut down within days if supply chains are not immediately restored.
In response to the situation, India's Oil Ministry yesterday (8 March) announced the formation of a committee to examine supply issues affecting non-domestic LPG users.
"In light of current geopolitical disruptions to fuel supply and constraints on LPG availability, the ministry has directed oil refineries to increase LPG production and prioritise domestic consumption," the ministry said in a post on X.
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Authorities have prioritised LPG supply for households and introduced a 25-day inter-booking period for domestic cylinders to curb hoarding and prevent black marketing.
However, the move has further tightened supply for commercial users such as restaurants and hotels.
Industry sources said the disruption has already begun affecting operations in major cities including Mumbai and Bengaluru.
Vijay Shetty, President of the India Hotels and Restaurant Association, said the shortage is spreading rapidly and could soon paralyse the sector.
"For LPG supply to non-domestic sectors, a committee of three Executive Directors (EDs) of Oil Marketing Companies (OMCs) have been constituted to review the representations for LPG supply to restaurants/hotels/other industries," the ministry said.
India consumes about 31.3 million tonnes of LPG annually. As much as 87 per cent of this is in the domestic sector that is household kitchens, and the rest in commercial establishments such as hotels and restaurants.
Of this total requirement, as much as 62 per cent is met through imports. The US and Israel attacks on Iran and Tehran's retaliation has shut the Strait of Hormuz, through which India got 85-90 per cent of its LPG imports from countries like Saudi Arabia.
