West Asia conflict | Govt invokes Essential Commodities Act to ensure gas to priority sectors

India is dependent on imports to meet over 60% of its LPG requirements. Roughly 90% of these imports are typically routed through the Strait of Hormuz.

New Delhi: The Union government on Tuesday invoked emergency provisions under the Essential Commodities Act to regulate the supply of natural gas to priority sectors like domestic cooking and transportation as the ongoing conflict in West Asia continues to disrupt global energy flows.

The Narendra Modi government has also directed refineries and petrochemical units to maximise the production of liquefied petroleum gas (LPG). According to official sources, the directive has led to around 10 per cent increase in domestic production of LPG.

India is dependent on imports to meet over 60 per cent of its LPG requirements. Roughly 90 per cent of these imports are typically routed through the Strait of Hormuz. Near closure of the Strait due to the US-Israel-Iran war has hit oil and gas supplies globally, including India.

Though the government claims that so far there is no shortage of oil and gas supplies in the country, it has invoked the force majeure clause to prevent hoarding and ensure availability of energy for priority sectors of the economy.

The development came after restaurants in major cities including Bengaluru, Mumbai, Hyderabad and Delhi complained about LPG shortages. The Ministry of Petroleum and Natural Gas has formed a panel comprising executive directors of oil marketing companies including Indian Oil, Hindustan Petroleum and Bharat Petroleum to monitor the supplies of commercial LPG.

Prime Minister Narendra Modi held a meeting with Petroleum Minister Hardeep Singh Puri and External Affairs Minister S Jaishankar to review the situation.

“In light of current geopolitical disruptions to fuel supply and constraints on the supply of LPG, the Ministry has taken the step for higher LPG production and securing it for supplying to domestic customers,” Indian Oil Corporation, Bharat Petroleum and Hindustan Petroleum said in a joint statement.

“Along with ensuring supplies to all domestic customers, it has been decided to make supplies as per requirement to the essential non-domestic sectors such as hospitals, educational institutions, etc,” it said.

According to the official order “Natural Gas (Supply Regulation) Order, 2026”, the supply of natural gas to the certain sectors shall be treated as priority allocation and shall be maintained subject to operational availability to 100 per cent of their past six-month average gas consumption.

These priority sectors include: domestic piped natural gas (PNG) supply; compressed natural gas (CNG) for transport; LPG production, including LPG shrinkage requirements; pipeline compressor fuel; and other essential pipeline operational requirements.

“The Union government has assessed that the ongoing conflict in the West Asia has resulted in the disruption of liquefied natural gas (LNG) shipments through the Strait of Hormuz and suppliers have invoked force majeure clause which would entail diversion of natural gas to the priority sectors,” it said.

To maintain supplies for priority users, the government has allowed curtailment of gas to other sectors. Petrochemical facilities — including ONGC Petro Additions Limited, GAIL Pata Petrochemical Complex and Reliance O2C — may face supply reductions first, followed by power plants if required. Refineries have also been asked to absorb part of the disruption by cutting gas consumption.