India has signed its first structured long-term liquefied petroleum gas (LPG) import deal with the US, securing nearly 2.2 mn tonnes of supply for the contract year 2026, Petroleum Minister Hardeep Singh Puri said in a post on X. The volume is roughly equivalent to 10% of India’s annual LPG imports and marks the country’s first term-linked procurement arrangement with US suppliers.

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Supply + pricing: The LPG will be sourced from the US Gulf Coast, with pricing linked to Mount Belvieu, the global benchmark for LPG contracts. The agreement is structured as a one-year contract for 2026, the minister said, describing it as a “historic first” for India’s LPG supply chain.

Why does it matter? The contract forms part of India’s broader effort to diversify LPG supply sources and secure affordable, reliable volumes for a rapidly growing domestic market. Structured cargoes from the US are intended to strengthen energy security and support the government’s consumer protection measures amid volatility in global LPG prices.

Rising subsidy bill: Last year, a hike in LPG prices cost the government a subsidy bill of INR 400 bn (USD 4.8 bn) to shield low-income households, according to the minister. Even as global LPG prices rose over 60% last year, beneficiaries of the government-subsidized Ujjwala cooking-gas scheme continued to pay up to INR 550 (USD 6.6) per cylinder, compared with an actual market cost of about INR 1.1k (USD 13.2).

IN CONTEXT- India imported about 20.5 mn tonnes of LPG in 2024, with more than 90% of volumes sourced from Middle Eastern suppliers, Reuters reports. India’s LPG imports reached a record 21 mn tonnes in 2024, up 13% from the previous year, reflecting continued demand growth, Argus Media reports. From 2026, India plans to source roughly 10% of its cooking gas imports from the US at cheaper costs as part of the broader push to diversify supply routes and reduce reliance on MENA suppliers. Since India largely relies on imports to meet its LPG demands, it is seeking to diversify sources to ensure sustained supplies at lower cost to keep subsidy costs in check.

Who signed it: The agreement was concluded by India’s three state-run fuel retailers — Indian Oil Corporation (IOCL), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL). Teams from the companies recently visited the US to finalize discussions with major producers, Puri said.

Indian jet fuel reaches US West Coast

MEANWHILE- India has shipped its first-ever jet fuel cargo to the US West Coast, seizing a rare arbitrage window created by supply disruptions due to repairs at a key refinery in California, Reuters reports. About 60k tonnes of aviation turbine fuel were loaded at India-based conglomerate Reliance Industries ’ Jamnagar facility in late October, and are scheduled to arrive in Los Angeles in early December.

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