India Sees Major Jump in West Asian LPG Imports Due to Ship-to-Ship Cargo Transfers

Recovery in Imports

India's imports of liquefied petroleum gas, or LPG, from West Asia have jumped over the past couple of months, marking a big recovery from supply hits caused by the regional war. Gulf suppliers are using ship-to-ship cargo transfers to move LPG through the Strait of Hormuz. In September and October, imports from the UAE averaged 565,315 tonnes, which is up 240 percent from the March-August average. Volumes from Kuwait rose 248 percent to average 181,746 tonnes in the same months. Average monthly imports from Qatar climbed to 147,133 tonnes compared to 67,527 tonnes earlier. No LPG has been imported from Saudi Arabia for four months.

Shift Away From US

As Gulf supplies improved, US LPG volumes dropped over the past two months after peaking during the earlier supply crisis. US imports averaged 418,291 tonnes in September and October, down 36 percent from the March-August average. The US had become India's top supplier during the worst of the disruption, but the UAE took the top spot in September and October. The shift is driven by suppliers taking higher risks and using shuttle tankers that sail without location transponders to avoid detection before transferring cargo in safer waters off Oman or India's west coast.

Impact on Consumers

The West Asian conflict started in February-end, causing energy supplies through the Strait of Hormuz to drop sharply from March. Total LPG imports fell from 2.03 million tonnes in February to 1.17 million tonnes in March, recovering to about 1.52 million tonnes in October. The supply squeeze forced India to ration fuel for industrial and commercial users to protect millions of households. Domestic refineries also ramped up production to make up for lost imports, though some emergency measures have since been rolled back.

Context

Ship-to-ship transfers are often used in maritime trade to bypass high-risk chokepoints and keep vital energy corridors functioning during geopolitical conflicts. India relies heavily on foreign energy imports to meet its domestic consumption needs, making supply routes through the Persian Gulf critically important for its economy.