India Secures Historic LPG Import Deal with the United States

India has entered into a landmark agreement with the United States to import liquefied petroleum gas (LPG), marking a significant shift in its energy sourcing strategy. Announced by Union Minister for Petroleum and Natural Gas Hardeep Singh Puri on November 17, 2025, the one-year contract will see Indian public sector oil companies import approximately 2.2 million tonnes per annum (MTPA) of LPG from the U.S. Gulf Coast for the contract year 2026. This volume represents nearly 10% of India's total annual LPG imports, making it the first structured contract for U.S. LPG in the Indian market.

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The agreement is part of India's broader strategy to diversify its energy sources and enhance energy security, especially as it has historically relied on Middle Eastern suppliers for over 90% of its LPG imports. The pricing for this new supply will be benchmarked to Mount Belvieu, a key pricing hub for global LPG trade, which is expected to provide greater transparency and stability in procurement.

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Minister Puri emphasized that this deal is a crucial step in ensuring affordable and reliable LPG supplies for Indian households, particularly for beneficiaries of the Pradhan Mantri Ujjwala Yojana, a government initiative aimed at providing subsidized LPG connections to low-income families. Despite a 60% surge in global LPG prices last year, the government absorbed significant costs to keep domestic prices stable, with Ujjwala beneficiaries paying only INR500-550 per cylinder compared to the actual market price exceeding INR1,100.

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Hardeep Singh Puri stated, “One of the largest and the world’s fastest-growing LPG markets opens up to the United States. In our endeavour to provide secure, affordable supplies of LPG to the people of India, we have been diversifying our LPG sourcing.” He further noted that the deal reinforces the government's ongoing efforts to secure reliable energy supplies for the country.

India signs “historic” LPG deal with the US: Union Minister Hardeep Singh PuriCNBC TV18India signs first long-term US LPG deal to secure household supplyThe StatesmanScroll.in

Commerce Secretary Rajesh Agrawal clarified that while the LPG deal is not part of ongoing trade negotiations with the U.S., it contributes to the overall goal of achieving a more balanced trade relationship between the two nations.

The Hindu

Despite the positive reception of the deal, some analysts caution that the logistics of importing LPG from the U.S. could lead to increased costs due to shipping distances. Concerns have also been raised regarding the potential volatility of LPG prices in the global market, which could affect domestic pricing despite the government's efforts to stabilize costs.

India signs first-ever long-term LPG import deal with USA

As India begins to receive shipments from the U.S. Gulf Coast at the start of the 2026 contract year, the government will continue to monitor market conditions and domestic demand. The success of this agreement may pave the way for further energy cooperation between India and the United States, potentially leading to more long-term supply arrangements in the future.

India signs first-ever long-term LPG import deal with USA

• “One of the largest and the world’s fastest-growing LPG markets opens up to the United States,” — Hardeep Singh Puri, Union Minister for Petroleum and Natural Gas

India signs “historic” LPG deal with the US: Union Minister Hardeep Singh Puri

• “India has been contemplating getting LPG from the US.” — Rajesh Agrawal, Commerce Secretary

The Hindu

This agreement not only strengthens India's energy security but also reflects a strategic pivot in its energy sourcing, aiming for a more resilient and diversified supply chain in the face of global market fluctuations.

India signs first-ever long-term LPG import deal with USA