October 31, 2026: India’s demand for liquefied petroleum gas (LPG) is likely to decline by around 100,000 barrels per day (b/d) in 2026, as closure of the Strait of Hormuz (SoH) impacted roughly 90 per cent of its imports of the cooking fuel.

The disruption left the country particularly exposed to reduced flows through the Strait of Hormuz. The supply shock directly affected end-use consumption as the government introduced measures including the rationing of LPG deliveries, Kpler said.

Priti Mehta, Kpler’s Senior Oil Demand Modelling Analyst, anticipated that LPG demand will recover from its Q2 2026 and Q3 2026 lows during Q4, supported by the festival season and higher imports, but the recovery is expected to remain incomplete.

Indian LPG demand is forecast to increase by only around 60,000 b/d in 2027, recovering slightly more than half of the 2026 decline. Part of the remaining loss is likely to be structural as the government promotes PNG connections, particularly among urban households connected to city gas distribution networks, she added.

“Indian LPG demand will remain constrained by the expansion of piped natural gas (PNG),” the Kpler analyst said.

Globally, LPG demand is expected to increase by 420,000 b/d next calendar year with Asia accounting for around 250,000 b/d of the growth, while the Middle East, Africa and Europe are each expected to add around 40,000 b/d, Mehta said.

European growth is primarily linked to the start-up of new propane dehydrogenation (PDH) capacity, while African demand should recover as product availability improves and prices normalise, she explained

(Source: Hindu Business line)