Amid rising disruptions caused by the ongoing conflict involving the United States, Israel and Iran in West Asia, the Government of India has invoked the Essential Commodities Act, 1955 to ensure the uninterrupted supply and regulated distribution of natural gas across the country. The move aims to protect critical sectors and households from potential shortages as global energy supply chains face increasing uncertainty.
According to a government notification, natural gas will now be treated as a priority allocation commodity, ensuring that supply is maintained subject to operational availability. The order states that consumers will receive up to 100 per cent of their average gas consumption over the previous six months, wherever feasible. The decision reflects growing concerns about disruptions in global energy transport routes and supply chains due to geopolitical tensions in the region.
India’s dependence on imports has heightened the urgency of the move. The country currently has 33.08 crore active liquefied petroleum gas (LPG) consumers, and the government is keen to maintain uninterrupted supply for households and industries. In the financial year 2024–25, India consumed 31.3 million tonnes of LPG, of which only 12.8 million tonnes were produced domestically, with the remaining quantity imported from abroad.
A significant portion of these imports comes from West Asian countries such as Saudi Arabia, whose energy shipments pass through the strategically crucial Strait of Hormuz. Nearly 85–90 per cent of India’s LPG imports transit through this narrow maritime corridor, making them vulnerable to disruptions amid the current regional conflict.
Reports indicate that while India has adequate reserves of crude oil—the primary raw material for producing petrol and diesel—around 30 per cent of the country’s natural gas supplies have been affected due to disruptions linked to the conflict. India consumes about 195 million standard cubic meters of natural gas daily, which is used for electricity generation, fertiliser production, conversion into compressed natural gas (CNG) for vehicles, piped cooking gas for households, and as a feedstock in industries ranging from steel to ceramics. Roughly half of this natural gas requirement is met through imports, further increasing vulnerability to international supply shocks.
To mitigate risks and diversify energy sources, India has also begun receiving LPG shipments under a recently signed import agreement with the United States. Under this deal, public sector oil companies will import around 2.2 million tonnes of LPG from the US Gulf Coast in 2026, accounting for roughly 10 per cent of India’s annual LPG imports.
Under the government’s control order issued through the Essential Commodities Act, natural gas supply has been prioritised across sectors:
100% supply assured for domestic piped gas connections and CNG for vehicles.
80% of the previous six-month average supply for tea estates, manufacturing units, and industries connected to the national gas grid.
80% supply for other industrial and commercial consumers.
70% supply for fertiliser plants, which are critical for agricultural production.
Supply reductions for refineries and petrochemical sectors, with around 35% cuts imposed to reallocate gas to priority users.
Officials noted that India earlier sourced around 30 per cent of its natural gas through routes linked to the Strait of Hormuz, and the new control measures are designed to ensure that essential sectors continue to receive adequate supplies. The government is also exploring alternative supply routes and additional imports to offset the shortfall.
The Essential Commodities Act, 1955 is a key legal framework that allows the central government to regulate the production, supply, distribution and pricing of essential goods. The law aims to prevent hoarding, black marketing and artificial shortages, ensuring that critical commodities such as food items, drugs and fuels remain available to consumers at fair prices.
By invoking this legislation, the government has taken a proactive step to stabilise the domestic energy market, prioritise household and essential sector needs, and safeguard India’s energy security at a time of heightened geopolitical uncertainty in West Asia.
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