India and US Forge Landmark LPG Deal for 2026

Indian state-run oil firms have signed a landmark deal to import 2.2 million tonnes of LPG from the US in 2026, marking a strategic shift in India's energy purchases to reduce trade imbalance and increase market diversification. The deal is part of ongoing bilateral trade discussions.

Indian state-run oil companies have finalized a groundbreaking agreement to import 2.2 million tonnes of LPG from the United States in 2026. The deal, marking the first structured US LPG contract for India, represents a strategic initiative to expand energy procurement from Washington and address trade imbalances.

This contract encompasses almost 10% of India's annual LPG imports, reflecting a significant diversification away from traditional Middle Eastern suppliers like the UAE, Qatar, Kuwait, and Saudi Arabia. In 2024, these countries accounted for roughly 90% of India's LPG imports. Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL), and Hindustan Petroleum Corporation Ltd (HPCL) will be central players in this import scheme.

The US-India LPG agreement is expected to bolster energy security and enhance affordability for Indian consumers, with pricing tied to Mount Belvieu benchmarks. This move aligns with India's efforts to increase US crude imports as part of broader trade negotiations, aiming to improve sourcing diversity and stabilize domestic LPG pricing.

(With inputs from agencies.)