MOSCOW: The war in Iran and the blockage of the strategic Strait of Hormuz are likely to halve this month’s imports of liquefied petroleum gas by India, its number-two importer, according to traders and ship-tracking data.
India covers around 60% of its LPG needs with imports and until the February 28 U.S.-Israeli strikes on Iran, the Middle East had accounted for around 90% of sea-borne supplies, reaching 22.7 million metric tons last year.
However, this month so far, the share of Gulf exporters fell to around 55%, with about 40% of imports coming from the U.S. and Russia and Argentina accounting for the rest, LSEG data showed.
SHARP DROP IN MARCH IMPORTS
Traders and ship-tracking data from LSEG suggest India is set to import 1.190 million metric tons of LPG this month, down 46% from February on a daily basis.
India loads LPG onto stranded empty ships amid gas crisis
LPG is mainly used as fuel for cars, heating and to produce other petrochemicals. The government in New Delhi earlier this month asked consumers to avoid panic buying of LPG cylinders and shift to piped natural gas where possible.
India is trying to secure more LPG, or propane and butane, cargoes from new sources such as the United States, Norway, Canada and Russia, in addition to Gulf region supplies that are still available.
Imports from Russia though are constrained by scarcity of available volumes and vessels, as well as relatively long routes from the key LPG exporting outlet of Ust-Luga in the Baltic Sea.
India’s government has said the local refineries have increased LPG output by around 40% from the start of March.
American Dollar Exchange Rate