India LPG Supply Plan 2026: The government has introduced a new contingency framework for domestic LPG production, assigning refinery-wise output capacities that could be activated when overseas supplies face disruption. The move is aimed at protecting household cooking gas availability and reducing the country's vulnerability to sudden import shortages.
Under the framework issued by the Ministry of Petroleum and Natural Gas on August 13, 21 refineries and upstream producers have been assigned a combined LPG production capability of around 63,810 tonnes per day.
This is significantly higher than India's normal domestic production level and represents roughly 70% of the country's current daily LPG requirement.
The initiative comes after recent geopolitical tensions in West Asia exposed the risks associated with India's heavy dependence on imported LPG.
Why Has India Introduced a New LPG Supply Framework?
India consumes far more LPG than it produces domestically.
During FY2025-26, the country consumed around 33.2 million tonnes of LPG, while domestic production stood at approximately 13.1 million tonnes.
Imports were therefore required to meet a substantial portion of demand.
According to figures cited in the report, India imported around 21.3 million tonnes of LPG during the financial year, highlighting how strongly the domestic market depends on overseas supplies.
This dependence can become a major concern when shipping routes are disrupted by geopolitical conflict.
The new framework is designed to give the government a ready-to-use production plan instead of having to determine refinery capabilities only after a crisis begins.
Refineries Get Emergency LPG Production Capacities
The government has mapped how much LPG individual refineries and producers could potentially supply when higher domestic production is required.
Together, the identified facilities have been assigned a maximum capability of about 63,810 tonnes per day.
For comparison, India's average domestic LPG production during FY26 was around 35,900 tonnes per day.
This means the emergency production potential identified under the plan is substantially above normal output.
However, the figure should not be interpreted as India's everyday LPG production target. It represents the higher production capability that could be called upon during periods of supply stress.
Reliance's Jamnagar Refinery Gets the Largest Allocation
Reliance Industries has been assigned the largest individual capacity under the framework.
Its domestic-market refinery at Jamnagar in Gujarat has been allocated an LPG production capability of approximately 18,000 tonnes per day.
Meanwhile, 18 refineries operated by public-sector oil companies together account for around 31,470 tonnes per day.
Nayara Energy's Vadinar refinery has been assigned approximately 4,480 tonnes per day.
Upstream and gas-sector producers including ONGC and GAIL India together account for another roughly 6,460 tonnes per day under the plan.
The distribution gives authorities a clearer picture of where additional domestic LPG could come from during an emergency.
West Asia Supply Disruptions Highlighted the Risk
The need for such planning became more apparent when conflict in West Asia threatened energy transportation routes.
The Strait of Hormuz is particularly important for global oil and gas trade. Any disruption around the region can create uncertainty for countries that rely heavily on imported energy.
During the recent period of supply stress, Indian refiners were reportedly asked to maximise LPG production, including by adjusting refinery operations that would otherwise direct some feedstock toward petrochemicals.
Domestic LPG output subsequently climbed to around 55,000 tonnes per day at one stage.
That experience demonstrated that India's refineries can potentially produce considerably more LPG than they do under normal operating conditions.
How Will the New System Work During a Crisis?
The newly mapped capacities effectively create an emergency playbook.
If international LPG supplies are disrupted, the government can ask designated refinineries and producers to raise production toward their assigned capabilities for a specified period.
The objective would be to increase domestic availability quickly enough to reduce the impact of delayed or unavailable imports.
Companies are also expected to prepare supporting infrastructure because producing more LPG alone will not solve a shortage.
Additional gas must be stored, transported to bottling facilities and distributed across the country.
Therefore, logistics and storage readiness will form an important part of the contingency system.
Household LPG Supply Is a Key Priority
Cooking gas is an essential household fuel for millions of Indian families, making LPG availability a sensitive part of the country's energy-security strategy.
A prolonged shortage could affect domestic cylinder supplies as well as commercial users.
The government's approach is therefore aimed at ensuring that domestic production can be raised quickly when imported cargoes become difficult to secure.
It could also reduce the need for last-minute interventions during international emergencies.
Can India Reduce Its Dependence on LPG Imports?
The emergency framework does not mean India will immediately stop importing large quantities of LPG.
Under normal conditions, imports remain necessary because domestic production is considerably below consumption.
The longer-term goal is to strengthen the country's ability to manage temporary supply disruptions while simultaneously exploring ways to raise domestic LPG recovery.
Refineries have reportedly been encouraged to examine technological improvements that could extract more LPG from existing operations.
Refineries May Explore New Technology
One area being considered is the conversion of other refinery streams, including naphtha, into additional LPG where technically and commercially feasible.
Refinery-unit upgrades could also help improve LPG yields.
Such investments would be important because emergency operating adjustments can only go so far. Permanently increasing India's domestic LPG capability would require technology, infrastructure and capital expenditure.
The government is therefore looking beyond short-term crisis management and encouraging refiners to identify ways to raise output over the longer term.
Storage and Transportation Will Be Equally Important
Increasing production from around 36,000 tonnes a day to substantially higher levels during an emergency creates another challenge: moving the extra gas.
Refineries need adequate storage capacity, while oil-marketing companies need tankers, pipelines, terminals and bottling infrastructure capable of handling the additional supply.
A contingency plan must therefore coordinate the entire chain from refinery production to the cylinder ultimately reaching consumers.
This is why companies are expected to maintain preparedness not only at production facilities but also across logistics and distribution networks.
LPG Capacity List Will Be Updated Regularly
The refinery-wise framework will not remain static.
The government plans to review the identified capacities twice every year, on January 1 and July 1.
This will allow newly commissioned refineries, expanded facilities and additional gas-production projects to be incorporated into the emergency plan.
Existing capacities can also be revised if refinery upgrades increase or alter their ability to produce LPG.
Regular reviews could make the framework more useful as India's refining and gas infrastructure expands.
What Does the New LPG Plan Mean for Consumers?
For households, the immediate takeaway is not that cylinder prices are about to change.
The measure is primarily about supply security, rather than setting retail LPG prices.
Its purpose is to reduce the risk that an international disruption develops into a serious domestic cooking-gas shortage.
If overseas cargoes are interrupted in the future, refiners would have a predefined production plan that could be activated more quickly.
That could help keep bottling plants supplied and minimise disruptions for domestic consumers.
Will the Plan Make LPG Cheaper?
Not necessarily.
Greater domestic production can reduce vulnerability to imported supplies, but LPG prices are influenced by several factors, including international energy prices, import costs, exchange rates, taxes, subsidies and government pricing decisions.
The new refinery-wise capacities are therefore better understood as an energy-security measure rather than a direct price-cutting policy.
Consumers should not assume that the introduction of the framework will automatically reduce the price of a domestic LPG cylinder.
Why This Plan Matters for India's Energy Security
India's large dependence on imported LPG means geopolitical events thousands of kilometres away can potentially affect domestic supplies.
The latest framework attempts to create a buffer against that risk by identifying exactly how much additional LPG can be produced within the country and where that production can come from.
With a combined emergency capability of around 63,810 tonnes per day, compared with FY26 domestic production averaging roughly 35,900 tonnes per day, the government would have considerably more domestic supply available to mobilise during a serious disruption.
Key Takeaway
India's new LPG contingency plan creates a refinery-by-refinery roadmap for increasing cooking-gas production when imports are disrupted.
Reliance's Jamnagar facility has been assigned the largest individual capacity at around 18,000 tonnes per day, while public-sector refiners, Nayara Energy and producers including ONGC and GAIL form other major parts of the emergency supply network.
The plan does not mean all these facilities will continuously operate at their assigned maximum LPG capacities. Instead, it gives the government a predefined mechanism to raise production during extraordinary supply conditions.
With the capacity list scheduled for review twice a year and refiners being encouraged to improve LPG recovery technology, the broader objective is clear: make India's cooking-gas supply more resilient before the next global energy disruption arrives.
