Three Indian state-owned companies, Indian Oil, Bharat Petroleum, and Hindustan Petroleum, have issued a joint tender to purchase approximately 2.75 million tons of liquefied petroleum gas from the United States for delivery in 2027. The tender, which was obtained by Reuters, reveals that the companies are seeking to secure four shipments per month of very large gas carriers, with each shipment carrying 46,000 tons of liquefied petroleum gas, split evenly between propane and butane.
The tender requires monthly deliveries throughout 2027, with an additional monthly shipment of 45,000 tons on a "delivery on board" basis. The tender is valid until October 22. Liquefied petroleum gas is a mixture of propane and butane gases. India is the second-largest importer of liquefied petroleum gas globally, after China. According to government data, India imported 21.85 million tons of liquefied petroleum gas, with approximately 90% of these imports coming from the Middle East.
The Indian government has been taking measures to secure liquefied petroleum gas supplies, particularly after the US-Israeli war on Iran in February, which led to a significant disruption in fuel supplies. In March, the government implemented emergency measures to divert petrochemical feedstocks from the industrial sector to domestic use, as households rely heavily on liquefied petroleum gas for cooking.
The tender issued by the Indian companies is a significant move to secure liquefied petroleum gas supplies from the US. The country's liquefied petroleum gas imports account for approximately 66% of its total consumption. The Indian government has been actively seeking to diversify its liquefied petroleum gas sources, with the US being a key player in the global market.
The US has emerged as a significant exporter of liquefied petroleum gas in recent years, with several major projects coming online. The country's liquefied petroleum gas exports are expected to increase in the coming years, providing opportunities for countries like India to secure supplies. The Indian companies' tender is likely to be seen as a positive development for the US liquefied petroleum gas export industry.
The joint tender issued by Indian Oil, Bharat Petroleum, and Hindustan Petroleum is a significant development in the global liquefied petroleum gas market. The tender highlights India's efforts to secure stable supplies of liquefied petroleum gas, which is an essential fuel for the country's households and industries. The country's reliance on liquefied petroleum gas imports is expected to continue, driven by growing demand for clean energy sources.
The Indian government's efforts to secure liquefied petroleum gas supplies are also driven by the need to reduce dependence on traditional fuels and promote clean energy sources. Liquefied petroleum gas is considered a cleaner-burning fuel compared to traditional fuels like coal and wood, making it an attractive option for households and industries. The country's liquefied petroleum gas demand is expected to continue growing, driven by increasing urbanization and industrialization.
Key points
- Indian state-owned companies issue joint tender to buy 2.75 million tons of US liquefied petroleum gas for delivery in 2027.
- India is the second-largest importer of liquefied petroleum gas globally, with 90% of its imports coming from the Middle East.
- The tender is a significant move to secure liquefied petroleum gas supplies from the US, which is emerging as a major exporter of the fuel.
