India has, for the first time, set maximum LPG production targets for individual public and private-sector refineries and upstream companies, capping combined output at 63,810 tonnes of LPG a day — more than twice India's domestic production in 2025-26 and about 70% of daily consumption — according to an order issued earlier this week by the petroleum and natural gas ministry. The facility-wise quotas apply whenever there is a shortage or disruption in supply, the order stated, as part of a stronger domestic supply system after Middle East chaos disrupted imports.
Refinery-wise quota allocation
Under the order, Reliance Industries' older refinery has been given the highest target, at up to 18,000 tonnes of LPG a day. The company's 33-million-tonne-a-year domestic-tariff area (DTA) refinery at Jamnagar, Gujarat — whose products are sold in India — carries that quota, while no target has been fixed for its 35.2-million-tonne-a-year export-only refinery at the same site. Eighteen refineries owned and operated by public-sector oil companies have been asked to produce a combined 31,470 tonnes a day, the report said.
Nayara Energy's 20-million-tonne-a-year refinery at Vadinar has been given a target of 4,480 tonnes a day, and gas producers and processors such as ONGC and GAIL, which make LPG from natural gas, have a combined target of 6,460 tonnes a day.
| Entity / facility | LPG target (tonnes/day) | Details |
|---|---|---|
| Reliance Industries – Jamnagar DTA refinery | 18,000 | 33 mtpa; products sold in India |
| 18 public-sector refineries | 31,470 | Combined |
| Nayara Energy – Vadinar refinery | 4,480 | 20 mtpa |
| ONGC & GAIL (natural-gas LPG producers) | 6,460 | Combined |
| All 21 facilities (the ministry's ceiling) | 63,810 | ~70% of India's daily LPG consumption |
Import dependence and the Strait of Hormuz trigger
India used 33.2 million tonnes of LPG in 2025-26, or about 91,000 tonnes a day, according to the ministry's data as reported by the TOI Business Desk. Domestic production was 13.1 million tonnes for the year (around 35,900 tonnes a day), while imports made up the remaining 21.3 million tonnes (about 58,400 tonnes a day) — meaning more than 64% of India's LPG requirement came from imports.
That dependence became a problem when the Iran war effectively shut the Strait of Hormuz, the sea route through which India received 90% of its imports from countries such as Saudi Arabia, the report said.
Crisis response and the emergency measures
After imports were hit, the government in March asked refineries to divert some streams used for petrochemicals towards LPG production, according to the report. It also initially stopped sales to industrial and commercial users and later increased supplies gradually. For households, the time between LPG refill bookings was increased, and consumers were encouraged to shift to piped natural gas, whose supplies were not as badly affected by the war.
Domestic LPG production rose to around 55,000 tonnes a day at the height of the crisis. The emergency orders asking refineries to maximise production were gradually withdrawn after supplies improved from mid-June, the report said. The new order now sets facility-wise production levels instead of relying only on emergency directions.
Infrastructure and upgrade mandates
The new rules require refineries and upstream companies to maintain enough infrastructure to store, move and transport LPG, and to take technically and economically possible steps to increase production. The ministry order stated:
It is hereby ordered that all public sector, joint venture and private sector oil refining companies, and upstream oil companies shall develop, augment and at all times maintain adequate infrastructure for storage, evacuation and transport of Liquefied Petroleum Gas (LPG) either by itself or through other entities viz railways or road tankers adequate for the specified quantities.
Companies have also been asked to implement all technically and economically feasible measures and technologies to maximise LPG production beyond current minimum producible quantities, the order said. These include:
- Converting naphtha into LPG
- Upgrading gasoline-based fluid catalytic cracking (FCC) units to petro-fluid catalytic cracking (PFCC) units
- Intimating the Centre for High Technology or any other authorised agency whenever such an upgrade is undertaken
Market implications
The ceiling of 63,810 tonnes a day for the 21 covered facilities is more than twice India's domestic LPG production in 2025-26 and about 70% of the country's daily consumption, the report noted. Reliance's Jamnagar DTA refinery alone holds 18,000 tonnes a day of that quota — the single largest allocation — while the 18 public-sector refineries together account for 31,470 tonnes a day. Because the quotas trigger only on supply shortages or disruptions, procurement and trading desks now have a clearly defined emergency domestic supply ceiling, with the next reference point being the ministry's Schedule of specified quantities once the order is implemented.
Sources:
