Iran-Israel War: The impact of the gas supply disruptions amid the Iran-Israel conflict is now becoming apparent. The sudden shortage of commercial LPG cylinders has also caused concern for the entire hospitality sector.
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Iran-Israel War: A war-like situation persists between the US, Israel, and Iran. Tensions in the Middle East are at their peak. Consequently, global crude oil prices have surpassed $100 per barrel. Commercial users of cooking gas (LPG) in major cities like Mumbai, Chennai, Hyderabad, and Bengaluru, and the tile and ceramics industry in Morbi, Gujarat, are now facing a gas shortage.
Gas Cylinder Shortage
The government has instructed refiners and fuel retailers to prioritize the delivery of gas cylinders to households. Consequently, the supply of 19-kg commercial cylinders to hotels and restaurants has been reduced. Consequently, major cities are experiencing a shortage of commercial gas cylinders. The sudden shortage of commercial LPG cylinders has also put the entire hospitality sector in a state of worry.
Restaurant associations in Maharashtra and Karnataka have warned that if supplies are not restored, eateries could close within days. Industry representatives say the disruption has started affecting operations in Mumbai and Bengaluru.
Restaurants on the Verge of Closure
According to media reports, Vijay Shetty, President of the India Hotels and Restaurants Association, said that the shortage is spreading rapidly and the sector could soon grind to a halt.
He said, “If this shortage continues, all restaurants in Mumbai will be closed in the next two days.” He also said that the association has written to Union Petroleum Minister Hardeep Singh Puri and is in touch with Maharashtra Civil Supplies Minister Chhagan Bhujbal. Restaurant owners say that commercial LPG supplies have largely stopped since Sunday, while domestic cylinders are being delivered within two to eight days of booking.
What is the government’s decision?
It should be noted that India imports up to 90 percent of its LPG needs from the Middle East. Due to tensions there, ships arriving through the Strait of Hormuz have reduced. Amid this limited supply, the government has decided to provide relief to domestic consumers, as hotels and restaurants often have the option of larger electric ovens, piped natural gas (PNG), and induction. However, domestic consumers largely rely on 14.2 kg LPG cylinders. Therefore, oil marketing companies like Indian Oil Corporation, Bharat Petroleum, and Hindustan Petroleum have been directed to prioritize domestic cooking gas supply amid the supply shortage.
Officials said the waiting period for LPG deliveries has been increased from 15 days to 25 days to prevent hoarding by consumers. Sources said India is looking for new international suppliers to stabilize LPG supplies, including potential imports from Algeria, Australia, Canada, and Norway. Additionally, oil marketing companies have been asked to increase LPG production and adjust their product mix to manage demand.
