India plans to buy a quarter of its LPG imports from the US in 2027: Report

India plans to source up to a quarter of its liquefied petroleum gas (LPG) imports from the United States in 2027. This is expected to reduce dependence on the Middle East and support efforts to secure a trade deal with Washington, according to three sources familiar with the matter who told Reuters.

The decision follows India's worst LPG shortage earlier this year, caused by the Iran war and the closure of the Strait of Hormuz that disrupted supplies. The government took emergency measures to divert petrochemical feedstocks from industry to households, which use LPG as cooking fuel.

India is the world's third-largest oil importer and consumer, and sourced about 90% of its 21.85 million metric tonnes of LPG imports from the Middle East in 2025. Imports accounted for around 66% of the country's LPG consumption, according to government data.

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State-run refiners Indian Oil Corp, Bharat Petroleum Corp, and Hindustan Petroleum Corp are expected to issue tenders within one to two months for US LPG supplies for 2027. A delegation from the three companies is also likely to visit the US next month to discuss sourcing, the sources said.

Higher purchases of US energy could help India narrow its trade surplus with Washington, a key demand of President Donald Trump, as New Delhi seeks to conclude a long-awaited trade agreement with the United States within the next three to four months.

India has pledged to increase US energy purchases by $10 billion to $25 billion in the near future. The two countries have set a target of reaching $500 billion in bilateral trade by 2030.

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India has already stepped up spot purchases from the US and other suppliers to offset reduced Middle East supplies. US LPG imports crossed 1 million tonnes in June for the first time and are expected to exceed India's initial 2026 annual contract target of 2.2 million tonnes, the sources said.

Lower supplies from the Middle East reduced India's LPG consumption to about 14.7 million tonnes during January-June 2026, down around 8% from a year earlier. Imports fell about 28% to around 7.5 million tonnes, according to provisional government data.

One source said India's LPG consumption is expected to fall to about 30 million tonnes this year because of lower supplies. However, LPG imports could rise to around 20 million tonnes in 2027 as demand recovers to about 31 million tonnes.