A serious cooking gas crisis is unfolding across India as restaurants in several major cities are reportedly struggling to obtain commercial LPG cylinders. According to hospitality industry groups, the shortage has already forced a significant number of restaurants to shut down operations, and many more may follow if supplies are not restored quickly.
Cities such as Mumbai, Bengaluru, Chennai, and Lucknow are witnessing growing disruptions in the hospitality sector due to the shortage of commercial cooking gas. Reports suggest that nearly 20 percent of restaurants in Mumbai have already closed temporarily due to the inability to secure LPG cylinders. Industry bodies, including the Indian Hotel and Restaurant Association, have warned that if gas supply issues continue, as many as 50 percent of restaurants in the city could shut down within days.
The situation appears similarly serious in Bengaluru, where many restaurants are on the verge of closure due to the lack of commercial cylinders. Restaurants in Lucknow are also facing similar challenges, with many struggling to maintain operations.
Due to the shortage, some restaurants have begun exploring alternative fuel sources such as coal and diesel to cook food. In several cases, restaurant owners are purchasing LPG cylinders from the black market at nearly double the normal price just to keep their kitchens running.
The crisis has sparked widespread discussion on social media, with many people expressing concern that the shortage could eventually affect domestic LPG supplies used in households.
The current panic within the restaurant industry reportedly began after a government decision issued on March 9. Under this order, LPG supply was divided into different priority categories, determining how gas would be allocated across various sectors.
Under the new classification system, household cooking gas and PNG and CNG used for vehicles were placed in the highest priority category. The government decided that this category would receive 100 percent of the required supply.
Commercial users, including restaurants, were placed in the next category. Under the new rules, commercial users would receive only 80 percent of their usual LPG supply, and even that allocation would depend on overall availability.
This means that domestic cooking gas and transportation fuels receive full priority, and only the remaining available supply would be allocated to commercial sectors such as restaurants.
Restaurants typically use commercial LPG cylinders weighing between 19 kilograms and 47 kilograms. These are significantly larger than domestic cylinders, which usually contain 14.2 kilograms of gas.
After the government order was announced, restaurant owners across the country began reporting difficulties in obtaining commercial cylinders. Many industry representatives claim that even the promised 80 percent supply is not being delivered.
While the initial crisis has primarily affected restaurants, there are signs that domestic LPG supply may also be experiencing disruptions in some areas.
For example, in cities such as Lucknow, households that previously received LPG cylinders within 24 hours of booking are now reportedly waiting between five and seven days for delivery.
If supply pressures continue to worsen, analysts warn that the shortage could eventually impact domestic users as well.
The government’s priority remains ensuring uninterrupted domestic cooking gas supply. To achieve this, authorities have invoked the Essential Commodities Act.
The Essential Commodities Act was passed in 1955 to ensure that essential goods remain available to the public at fair prices. Under this law, the government has the authority to regulate production, supply, and distribution of key commodities. It can also take measures to prevent hoarding, control stock levels, and stop black marketing.
Using the provisions of this law, the government has instructed refineries and petrochemical plants to increase LPG production.
The government has also ordered that two important hydrocarbon materials, propane and butane, should be used exclusively for LPG production for the time being.
Propane and butane are key hydrocarbon gases used in the production of LPG. These materials are typically used not only for cooking gas but also in petrochemical industries.
They are commonly used in manufacturing chemicals that later become products such as plastics, synthetic rubber for tires, textile fibers, paints, and many other industrial materials.
With the government directing that propane and butane be diverted primarily toward LPG production, the output of several petrochemical products could decline temporarily. Industries involved in plastics, paints, rubber, and synthetic fibers may experience production disruptions during this period.
India currently produces around 40 percent of its total LPG requirement domestically. The remaining 60 percent is imported from countries in the Middle East, including Saudi Arabia, Qatar, the United Arab Emirates, and Kuwait.
However, the shipping routes through which these supplies typically travel have recently faced disruptions. These routes pass through sensitive geopolitical regions, and recent tensions have affected the movement of oil and gas shipments.
This disruption in supply chains is one of the major reasons behind the current LPG shortage.
Even though India has strategic reserves of crude oil estimated to last around 50 to 60 days, converting that crude into LPG is not a simple or immediate solution.
One major issue lies in how LPG pricing is regulated in India. Unlike petrol and diesel, which are largely market-linked, LPG prices are heavily regulated by the government.
To keep cooking gas affordable for households, oil marketing companies are often required to sell LPG at prices below cost. Historically, this has resulted in financial losses for these companies.
To offset these losses, many refineries have increasingly diverted propane and butane toward petrochemical production instead of LPG production, since petrochemical products typically offer higher profit margins.
As a result, domestic LPG production has remained limited relative to demand.
Another key factor behind the current shortage is the rapid growth in LPG demand over the past decade.
In 2016, the government launched the Pradhan Mantri Ujjwala Yojana, a scheme designed to provide LPG connections to low-income households.
The program was highly successful and dramatically expanded LPG access across India. As a result, the number of LPG connections increased from around 14 crore households to approximately 33 crore households.
This massive increase significantly boosted demand for cooking gas across the country.
While demand continued rising, supply growth did not keep pace.
India has also invested heavily in building strategic crude oil reserves in recent years to improve energy security.
However, the country has relatively limited storage capacity specifically for LPG.
India’s estimated LPG storage capacity is about 1.9 million metric tons, which is roughly equivalent to 21 to 22 days of national consumption.
According to estimates, around 10 days of this storage has already been consumed, which is adding to concerns that supply pressures could intensify if imports remain disrupted.
To address the situation, the government has instructed refineries to increase LPG production by about 10 percent.
However, because domestic production accounts for only around 40 percent of total demand, even a 10 percent increase would raise domestic contribution only to about 44 percent.
This means that India would still need to import roughly 56 percent of its LPG requirement.
Authorities are currently trying to secure additional supplies from other countries, but progress has reportedly been limited so far.
Experts suggest that the situation could improve if geopolitical tensions affecting oil and gas shipping routes ease in the coming days.
If maritime transport routes reopen fully, LPG imports could resume normally and supply pressures would likely ease.
Another potential option is the use of naval escorts to ensure safe passage for energy shipments through critical maritime chokepoints such as the Strait of Hormuz.
Some countries, including China, have reportedly been able to maintain shipments by negotiating security assurances for their vessels.
Given India’s historically stable relations with Iran and several Middle Eastern energy suppliers, similar arrangements could potentially be explored.
If the crisis continues for several weeks, the impact could extend beyond restaurants and households.
Disruptions to LPG supply could affect transportation, manufacturing, and several industrial sectors. In the worst case, analysts warn that economic activity could slow down significantly, similar to disruptions experienced during the COVID-19 lockdown period.
For now, authorities and industry groups are closely monitoring developments over the coming days.
This article is for informational and educational purposes only. The information presented is based on publicly discussed developments and available reports. Readers are advised to verify details through official government announcements and reliable news sources before making any decisions or conclusions.
