India Seals First Historic LPG Import Deal with the United States

India has taken a major step in strengthening its energy security with the signing of its first structured agreement to import liquefied petroleum gas from the United States. The one-year contract, set for 2026, will supply around 2.2 million tonnes per annum, meeting nearly 10 per cent of India’s total LPG import requirements and marking a strategic diversification in sourcing.

A Historic First in India–US Energy Trade

The Union Petroleum Minister described the development as a landmark moment for India’s rapidly expanding LPG market. The agreement opens the door for long-term cooperation with US suppliers and reflects India’s intention to secure stable, affordable and diversified LPG supplies for domestic households.

PSU Collaboration and Global Engagement

Indian Oil, Bharat Petroleum and Hindustan Petroleum jointly negotiated with major American producers during recent visits to the United States. Their coordinated engagement resulted in the first structured long-term contract for US-origin LPG. The pricing has been benchmarked to the Mount Belvieu hub, strengthening transparency and stability in procurement.

Supporting Household Affordability and Welfare Schemes

The government highlights this deal as a key element in protecting households from global price volatility. Despite an over 60 per cent surge in international LPG prices last year, targeted support ensured that beneficiaries of welfare schemes continued to pay significantly below market levels. The new arrangement reinforces ongoing efforts to maintain supply reliability for millions of families.

Exam Oriented Facts

• India will import 2.2 MTPA of LPG from the US under a structured one-year deal for 2026.
• The supply represents close to 10 per cent of India’s annual LPG imports.
• The contract is benchmarked to the Mount Belvieu pricing hub.
• PSUs IOCL, BPCL and HPCL jointly finalised the agreement after discussions with US producers.

Milestone for a Fast-Growing LPG Market

The agreement underscores India’s status as one of the largest and fastest-growing LPG markets globally. It strengthens long-term diversification efforts, enhances resilience against price shocks and deepens energy cooperation with the United States, contributing to secure and affordable LPG access across the country.