New Delhi: India Monday announced its first “structured deal” with the US to source liquified petroleum gas (LPG) accounting for roughly 10 percent of its needs, months after President Donald Trump’s demand that New Delhi increase its energy purchases from his country.
“One of the largest and the world’s fastest growing LPG market opens up to the United States. In our endeavour to provide secure affordable supplies of LPG to the people of India, we have been diversifying our LPG sourcing,” Energy Minister Hardeep Singh Puri said in a statement on the social media platform ‘X’.
The minister added: “In a significant development, Indian PSU oil companies have successfully concluded a 1 year deal for imports of around 2.2 MTPA LPG, close to 10% of our annual imports – for the contract year 2026, to be sourced from the US Gulf Coast- the first structured contract of US LPG for the Indian market.”
India is one of the world’s largest consumers of LPG, which is used primarily for cooking purposes. According to reports, the country produces roughly 40 percent of its demand, while the remaining is imported from third countries. India is the second largest market in Asia for the consumption of LPG behind China.
The US under President Trump has been demanding India increase its energy and LPG purchases from America over the last few months. Washington has been keen to become a major energy supplier for India in a bid to reduce its trade deficit, which stood at roughly $40 billion in the last financial year.
Representatives from Indian Oil, Bharat Petroleum and Hindustan Petroleum have reached the US and carried out discussions, which have recently concluded, with American producers over the last few months.
For India, the deal comes as the government is attempting to diversify its sources. India’s continued reliance on different sources of energy other than the US has rankled the American administration since Trump returned to the White House earlier this year. The traditional LPG suppliers to India are primarily from West Asia, including Qatar, the UAE, Kuwait and Saudi Arabia, according to reports.
“This purchase is based on using Mount Belvieu as the benchmark for LPG purchases and a team of our officials from @IndianOilcl , @BPCLimited & @HPCL had visited the US and engaged in discussions with major US producers over the last few months, which have been concluded now,” said Puri.
A historic first!
One of the largest and the world’s fastest growing LPG market opens up to the United States.
In our endeavour to provide secure affordable supplies of LPG to the people of India, we have been diversifying our LPG sourcing.
In a significant development,…
— Hardeep Singh Puri (@HardeepSPuri) November 17, 2025
The deal offers India a potential source for the government to potentially hedge against any price spikes in the global energy prices. Puri pointed out in his statement that despite global prices increasing by 60 percent in the last year, the Indian government has been able to maintain stable prices for LPG cylinders.
“Even as global prices soared by over 60 percent last year, Modi ensured that our Ujjwala consumers continued to receive LPG cylinders at just Rs 500-550 whereas the actual cost of the cylinder was over Rs 1,100. Government of India incurred the cost of over Rs 40,000 crore last year in order to ensure our mothers and sisters did not feel the burden of rising international LPG prices,” said Puri.
The announcement comes at a time when India and the US continue to negotiate over a potential trade deal. Last week, sources in the establishment said that New Delhi is now awaiting a response from the US over its latest trade proposals. Ties between New Delhi and Washington D.C. have cooled in the last few months as irritants over trade remain.
However, between September and October, Prime Minister Narendra Modi spoke with President Trump at least thrice, indicating a partial political thaw.
(Edited by Tony Rai)