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Gulf war disrupts LPG supplies, hitting India's food sector
Indian restaurants are scaling back operations or shutting down as liquefied petroleum gas (LPG) supplies tighten due to US-Israeli strikes on Iran, which have disrupted shipments through the Strait of Hormuz. The crisis, unfolding nearly 3,000 km away, is sending ripples through commercial kitchens across the country.
Restaurants forced to adapt or close
Social media is flooded with videos of long queues outside cooking-gas dealers in cities and towns, as concerns over fuel availability grow. The National Restaurant Association of India, representing around 500,000 eateries, reports severe shortages of commercial LPG cylinders and piped gas.
"The situation is dire. Cooking gas simply isn't available,"
Manpreet Singh, National Restaurant Association of India
Singh notes that many restaurants have temporarily closed, particularly in Delhi and southern India. Those still operating are turning to alternatives like coal, wood, or electric cookers to keep their kitchens running.
Regional impact
In Mumbai, reports suggest up to 20% of hotels and restaurants have fully or partially shut down. In Bengaluru and Chennai, some eateries are struggling with dwindling gas stocks, limiting their menus to basic items like coffee. Haroon Sait, who runs an artisan bakery and restaurant chain in Bengaluru, describes the situation as "pathetic," warning of significant business losses.
Operators are adjusting by shortening hours, reducing menus, or closing for lunch. Singh adds that closures fluctuate daily as supplies vary, with some Delhi restaurants reopening after brief shutdowns.
Government denies shortage, prioritizes households
Despite the crisis, the Indian government insists there is no LPG shortage. With over 300 million domestic users, officials say supplies are being redirected to households amid tensions in the Gulf. About 60% of India's LPG is imported, with 90% of those shipments passing through the Strait of Hormuz, now effectively closed by the conflict.
The oil ministry announced on 8 March that refineries were ordered to maximize LPG output for households, boosting domestic production by 25%. Non-domestic supply is being prioritized for essential sectors like hospitals and schools, with distribution described as "fair and transparent."
"Some panic booking and hoarding has been triggered by misinformation. The normal delivery cycle for domestic LPG remains about two-and-a-half days,"
Sujata Sharma, Petroleum Ministry official
Broader fuel concerns and market dynamics
Anxiety is spreading beyond kitchens, with videos circulating of long queues at petrol pumps in Chennai. However, analysts suggest concerns about India's broader fuel supplies may be overstated. Maritime intelligence firm Kpler notes that while 90% of India's oil imports-about 2.5-2.7 million barrels daily-pass through the Strait of Hormuz, the country could offset disruptions by increasing imports of discounted Russian crude.
Kpler estimates that incremental Russian crude imports in March could reach 1-1.2 million barrels per day, reducing India's effective shortfall from the Strait of Hormuz to around 1.6 million barrels daily. Sumit Ritolia, a refinery and oil markets analyst at Kpler, highlights that 25-30 million barrels of Russian oil are currently en route to India and China, providing a ready fallback.
US Ambassador to India Sergio Gor acknowledged India's role in stabilizing global oil prices, praising its continued purchases of Russian crude as part of this effort. India is also a major exporter of refined fuels, averaging net exports of 1.1 million barrels per day in 2025, with refiners diversifying crude sources to maintain domestic supply.
LPG remains the critical vulnerability
While crude and refined product supplies appear manageable, LPG remains India's weak spot. The country consumes roughly one million barrels daily but produces only 40-45% domestically, importing the rest-80-90% of which passes through the Strait of Hormuz. Even a 10-20% boost in domestic production would only cover 47-50% of demand, leaving India heavily reliant on imports.
"Crude supply risk can be partially mitigated through diversification and Russia flows. Refined product supply remains relatively comfortable. LPG availability is the real variable to monitor in the coming weeks."
Sumit Ritolia, Kpler
Hoarding and profiteering exacerbate crisis
Beyond supply constraints, patchy deliveries and hoarding are intensifying the crisis. Singh alleges that some retailers are exploiting the situation, black-marketing cylinders at inflated prices. Reports suggest cylinders are being hoarded and auctioned in some towns, further straining availability.
For now, India's oil supplies are cushioned by global trade flows, but the immediate challenge for restaurants and commercial kitchens remains: securing the next cylinder.
