New Delhi: India's active domestic LPG customer base has contracted for the first time on record, shedding 39 lakh connections in four months marked by an escalation in conflict in the West Asia region. Active domestic customers numbered 33 crore on August 1, against 33.39 crore on April 1, according to the Petroleum Planning and Analysis Cell (PPAC).
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Volumes moved with it. LPG-packed domestic sales fell 14.3 percent in July to 2,101.0 thousand metric tonnes (TMT), and 14.1 percent across April-July to 7,959.2 TMT. Total LPG consumption was down 16.4 percent for the month and 16.5 percent for the four-month period.
The steepest fall is in bulk LPG. Sales came in at 21.1 TMT in July against 80.5 TMT a year earlier, a decline of 73.8 percent. Over April-July, the segment shrank 79.8 percent, from 270.4 TMT to 54.5 TMT.
Packed non-domestic LPG, the commercial cylinder segment, fell far less — down 12.8 percent in July and 13.4 percent over four months. Direct private LPG imports dropped 82.2 percent over April-July, from 139.1 TMT to 24.8 TMT.
The commercial and industrial segments spent most of the period under formal supply caps. Petroleum and Natural Gas Minister Hardeep Singh Puri told Parliament on March 12 that Oil Marketing Companies would limit commercial LPG to 20 percent of their average monthly supply. He said the restriction was intended "to prioritise domestic LPG consumption and ensure there is no hoarding or black marketing."
The trigger was the disruption of shipping through the Strait of Hormuz during the West Asia conflict. Roughly 90 percent of India's LPG imports normally transit the strait. With imports meeting about 60 percent of consumption on that assessment, the strait accounts for a little over half of total domestic LPG availability.
Alongside the cap, the government extended the minimum refill booking gap for domestic cylinders to 25 days and directed refineries to raise LPG output.
The caps were eased in stages over the following weeks. On March 18, the ministry proposed raising the commercial allocation from 20 percent to 30 percent. The additional 10 percentage points were made conditional on states carrying out four city gas distribution reforms, setting up state and district committees to clear CGD applications, granting deemed permission after 24 hours, running a dig-and-restore scheme with restoration charges capped at Rs 10 lakh per kilometre, and cutting annual CGD rental or lease charges to zero. All this was done to expedite the expansion of Piped Natural Gas (PNG) network, with the government encouraging LPG consumers to shift to PNG wherever possible. CGD companies also rolled out incentives for consumers willing to make the transition from LPG cylinders to piped natural gas.
The Centre withdrew all remaining restrictions on commercial packed LPG on June 25, citing an improvement in the West Asia situation. Bulk LPG was treated differently. Supplies were restored only to 50 percent of pre-crisis consumption levels, and consumers with access to piped natural gas were encouraged to move to PNG instead.
That split tracks the July numbers. Packed non-domestic sales recovered to within 13 percent of last year. Bulk sales remained more than 70 percent below.
Auto LPG sale rose 8.4 percent in July to 6.4 TMT, and 39.7 percent over April-July to 32.2 TMT. The dispensing network moved the other way. Auto LPG stations numbered 334 on August 1, down 18.1 percent over the year.
Domestic piped natural gas connections totalled 1,74,05,020 as on June 30, PPAC data showed. CNG stations numbered 9,026. PMUY beneficiaries stood at 1,057.3 lakh on August 1. The number of LPG distributors was 25,616.
The international LPG price averaged USD 592 per metric tonne in July, against USD 532.47 for FY2025-26 as a whole. A subsidised domestic cylinder in Delhi was priced at Rs 942.00 as on August 1.
Direct benefit transfer subsidy on domestic LPG rose to Rs 1,646 crore in 2025-26 from Rs 366 crore the year before. PMUY subsidy was Rs 12,212 crore.
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Now, the Centre has approved a fresh incentive scheme for domestic PNG connections on August 18, effective September 1. It allocates city gas distributors an additional 200 standard cubic metres of lower-priced domestic gas for every new billed household connection, and the oil ministry has said it expects the payback period on connection spending to fall to about three years from around 10.