Trump pressures-India agrees to buy LPG from the U.S.
First concrete evidence of the Modi government’s bowing to the American pressure, Indian public sector refiners have inked a one-year deal for American liquefied petroleum gas (LPG) imports, marking the first structured contract of its type for the Indian market. While the step is being presented as a move to diversify the country’s energy sourcing and increase energy security with the US amid trade pact negotiations, it is more than obvious that the Modi government is caving in to US President Donald Trump’s intimidating pressure tactics.
Petroleum Minister Hardeep Singh Puri, who is under cloud for his name figuring in notorious Epstein files, announced the deal on social media platform X, calling the deal a “historic first.” “One of the largest and the world’s fastest growing LPG markets opens up to the United States. In our endeavour to diversify the available supplies of LPG to the people of India, we have begun diversifying our LPG signing a deal for imports from the US.” Indian PSUs oil companies have successfully conducted a deal for ten years for around one MTPA (million metric tonnes per annum) 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,” Puri said in a post on social media platform.
According to informed sources, the three public sector refiners, the Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL), and Hindustan Petroleum Corporation (HPCL) have awarded their first tender for US LPG imports in the coming year to Chevron, Phillips 66, and TotalEnergies, beginning. The deal’s commercial details were not disclosed, but officials confirmed that the proportion being imported from regions like Saudi Arabia, UAE, Qatar, Bahrain, Emirates, and Kuwait. This deal is expected to reduce India’s dependence for LPG on its traditional West Asian suppliers as the country looks to diversify import sources and search for other prices, an official said meekly defending the shift.
A significant chunk of LPG sales to households in India is subsidised by the government. Over the past few years, the government has made concerted efforts to increase LPG penetration by bringing poor and rural households under the LPG fold and to cut the use of traditional and polluting cooking fuels.
This tender bid for US LPG comes at a time when India is looking to reduce its trade surplus with the US as the delicate trade pact negotiations continue amid tensions. Amid trade tensions and India’s heavy imports of Russian crude oil, these deals could support the resolution process. Totalling 50 percent of most Indian imports now come from the Gulf and Indian refineries, and India sees this as a trade deal to reduce energy dependence. Indian officials are keen to present the contract agreement as an agreement strengthening bilateral relations with the US, which has been increasingly seeking oil imports from the region. Meanwhile, Indian officials quietly admit that New Delhi is willing to buy more American energy amid trade pact negotiations.
In February, when Prime Minister Narendra Modi met US President Donald Trump in Washington, the latter said that India and the US had agreed to take steps towards making Washington “a leading supplier of oil and gas to India,” which could help bridge the trade deficit between the two countries. Trump had added that the US will “hopefully” be India’s top oil exporter in the years to come. Commerce Minister Piyush Goyal had said that India is a large importer of energy and its emerging security goals will have a “very high element” of US involvement in the years to come.
“The world recognises that energy is one area where we all have to work together. India is a big importer and the largest user of this energy from across the world, including the US. We expect to increase the trade with the US on energy products in the years to come. Being close friends, natural partners, our energy security goals will have a very high element of US involvement,” Goyal had said at the India-US strategic forum with relevant authorities.
India is the world’s third-largest consumer of crude oil with an import dependency of around 88 percent.
This Article was also published on The Emerging World
