Indian Refiners Plans to Seek 4 Additional US LPG Cargoes in 2nd Tender

India’s state-run refiners are preparing to issue a second tender within the coming months to procure four more LPG cargoes from the United States on a short-term basis, as per the news reports.  

The move reflects an effort to reduce transportation costs by using their own shipping charters and to diversify supply beyond the Middle East, according to two senior refining officials. 

Key Development: New Tenders and Rising US LPG Purchases 

The planned tender will involve FOB supplies, marking a significant shift as Indian refiners look to deploy their own tankers for long-haul shipping for the first time. The refiners also intend to float several spot tenders for early 2026 deliveries, although details have not yet been disclosed. 

Spot purchases of US LPG have already reached a record 1.42 million tonnes in January to November, a steep jump from 0.1 million tonnes in 2024 and 0.4 million tonnes in 2023, based on Kpler data. India normally imports more than 60% of its LPG needs, with most supplies sourced from the Gulf region. 

Market Context and Pricing Dynamics 

State oil marketing companies agreed with 3 traders to source up to 2 million tonnes of US LPG in 2026 under this arrangement. 

If spot buying continues at current levels through next year, combined US supplies could reach an estimated value of around $2 billion in 2026, compared with only $60 million in 2024. This would significantly widen India’s energy trade with the United States. 

Read More: India Signs First Long-Term LPG Import Deal with the United States! 

Conclusion 

India’s strategy to expand US LPG procurement and shift towards FOB contracts reflects a desire to manage freight costs, diversify supply and influence pricing behaviour in the Middle East market. While US LPG remains more expensive to transport, refiners note that lower benchmark prices from Gulf suppliers have offset part of the cost burden, reinforcing the benefits of a more competitive supply landscape. 

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