India has signed a significant deal with the United States to import nearly 10 percent of its liquefied petroleum gas (LPG) needs. The one-year agreement, which will supply 2.2 million tonnes per annum, aims to diversify India’s energy sources. The LPG will be sourced from the US Gulf Coast, marking the first structured US LPG contract for the Indian market.
Minister for Petroleum and Natural Gas Hardeep Singh Puri called the deal part of India’s strategy to secure affordable and reliable LPG supplies. Puri noted that India’s LPG market is one of the largest and fastest-growing in the world, making it a crucial partner for US suppliers. The deal helps India reduce its dependency on a few sources for LPG.
This agreement comes amid strained relations between the United States and India. In August, tensions escalated when President Donald Trump raised tariffs on India to 50 percent. Trump accused India of exacerbating Russia’s war in Ukraine by purchasing discounted Russian oil, a claim that India has not confirmed. Despite these tensions, India and the US continue talks on trade and other issues.
In recent months, India has made efforts to distance itself from Russian crude. Indian state-backed HPCL-Mittal Energy stopped buying Russian oil after the US imposed sanctions on Moscow’s largest oil companies. Similarly, Reliance Industries, a major private buyer, is reviewing the impact of US and EU sanctions on its operations.
India’s economy, the world’s fifth-largest, showed robust growth in the last quarter, aided by government spending and consumer confidence. However, experts warn that US tariffs could reduce India’s GDP growth by up to 0.8% this fiscal year if the trade issues persist.
