‘A Critical Scenario’: Conflict on Iran Squeezes India's LPG Supplies.

The shockwaves of a conflict being fought nearly a significant distance away are now reaching India's homes.

As aerial attacks on Iran hinder energy deliveries through the key maritime chokepoint, availability of liquefied petroleum gas (LPG) are tightening across India, pushing restaurants to cut menus, reduce operating times and in some cases close completely.

Social media is filled with video clips showing crowds outside fuel suppliers across Indian metros and localities as worries over fuel supplies escalate. Commercial LPG users appear the worst hit: the biggest crunch is in restaurant kitchens.

"Conditions are critical. Kitchen fuel simply cannot be found," says a spokesperson of the a major restaurant body.

Most food outlets run either on industrial fuel canisters or pipeline-supplied fuel, and the scarcities are now being experienced across the country. "Numerous restaurants have shut down - some in northern India, many in the southern states. People are adopting solid fuels and electric cookers to keep kitchens going."

Localized Effects

In a western metro, accounts say up to a fifth of hotels and restaurants are already fully or partly shut as business fuel stocks dwindle. In the southern cities of Bengaluru and Chennai, some restaurants say their fuel reserves have dwindled with little backup. "Coffee is the sole item we can prepare and nothing else - it is truly dismal. Businesses are going to suffer," says a business operator in Bengaluru.

Restaurant operators are scrambling to adapt. "Food options are being cut, some are cutting lunch service and reducing hours," an industry representative says, adding that stoppages are varying as supplies wax and wane. "Several establishments in Delhi were shut yesterday - some have resumed operations. It's a changing landscape."

Retailers observe a surge in sales of electronic cooking appliances, with some saying they are running out of them.

Authority's View

Yet, the authorities maintains there is sufficient stock.

India has more than 300 million household consumers and officials say stocks are being reallocated to households as conflict-related stress from the regional hostilities impact energy markets.

Approximately a majority of India's LPG is sourced from abroad, and about 90% of those consignments pass through the Strait of Hormuz, the vital passage now significantly disrupted by the conflict.

The oil ministry says that it instructed refineries to boost LPG output for home needs, raising domestic production by about a significant margin. Non-domestic supply is being reserved for essential sectors such as healthcare and education, while distribution will be "fair and transparent".

"Some panic booking and hoarding has been sparked by false reports. The regular refill period for domestic LPG remains about 60 hours," says a senior official.

Growing Panic

Now the worry is moving beyond kitchens. On social media, a widely shared video from Chennai shows a long, snaking queue of motorbikes outside a fuel station. "The panic is real," the description reads.

According to analysis from industry analysts, concerns about India's broader energy security may be exaggerated.

India imports the overwhelming majority of its oil. Around a significant portion of its petroleum shipments - about millions of barrels a day - travel through the passage, largely from Middle Eastern nations.

Even if oil shipments through the Strait of Hormuz are disrupted, the gap could be partly offset by higher imports of Russian petroleum, according to a sector expert.

Based on shipping data and industry information, incremental Russian crude imports could reach around 1-1.2 million barrels a day, lessening India's effective deficit from exposure to the Strait of Hormuz to about a substantial volume of barrels a day.

"Around 25-30 million Russian oil barrels are currently on the water in the Indian Ocean and, with only key buyers as major buyers, those barrels remain a available backup," an analyst noted.

Kitchen Fuel: The Primary Concern

The key weakness is LPG, analysts say.

India consumes roughly a million barrels a day, but produces only less than half domestically, importing the rest - the vast majority through the Strait.

Refineries can tweak operations to extract a bit more LPG, but even a moderate increase would only raise domestic supply to about under half of demand, leaving the country largely dependent on imports.

In short: "Petroleum shortage concerns can be partially mitigated through diversification. Processed petroleum stocks remains relatively comfortable. Kitchen fuel stocks is the real variable to track in the coming weeks."

What may be intensifying the panic on the ground is not just tight supply but erratic supply chains - and the common threat of stockpiling.

An industry representative claims opportunistic profiteering.

"Retailers are exploiting the situation - illegally trading canisters and selling them at a inflated price. In one small town, I heard of cylinders being hoarded and auctioned off."

For now, India's energy imports may be protected by international market dynamics. But in restaurants across the country, the more immediate question is simple: how to get the next cylinder.