India's Three Major State-Owned Oil Companies Tender to Procure 2.75 Million Tons of U.S. LPG

en.Wedoany.com Reported - September 25 news: Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation have jointly launched a long-term supply tender for U.S. liquefied petroleum gas (LPG) for 2027, planning to procure approximately 2.75 million tons of LPG. The tender covers supply for the entire year of 2027, with bids valid until October 22.

Under the tender arrangement, the three state-owned oil companies will purchase 4 very large gas carrier (VLGC) cargoes per month, each carrying 46,000 tons, with propane and butane each accounting for half, on a delivered-at-destination basis. Calculated over 12 months of the year, this portion corresponds to 48 cargoes, or approximately 2.208 million tons of LPG. The tender also requires an additional 1 cargo of 45,000 tons per month, procured on a free-on-board (FOB) basis, corresponding to 12 cargoes, or approximately 540,000 tons for the full year. The two portions total approximately 2.748 million tons, corresponding to the total scale of approximately 2.75 million tons announced in the tender.

This procurement adopts two trade arrangements: "delivered at destination + FOB." In the former portion, the supplier is responsible for delivering the cargo to the agreed destination; in the latter portion, the Indian buyer takes delivery at the U.S. loading port and is responsible for subsequent ocean shipping. Indian Oil Corporation has previously initiated work on configuring very large gas carrier assets, planning to seek VLGCs in the 80,000 to 93,500 cubic meter class and studying the acquisition of a 50% equity interest in vessels, in order to expand U.S. LPG imports; the relevant plan allows Indian Oil Corporation or its joint venture IndianOil LNG to acquire equity interests in one or more vessels.

India's three state-owned refining companies began preparing in July this year to expand long-term U.S. LPG procurement for 2027, with the planned U.S. supply volume at that time accounting for up to approximately 25% of India's total annual LPG imports. In 2025, India imported approximately 21.85 million tons of LPG, of which about 90% came from the Middle East, with imports accounting for approximately 66% of the country's LPG consumption. This annual tender translates the 2027 U.S. supply into specific monthly cargo quantities, individual cargo sizes, and trade delivery methods.

The latest data from the Petroleum Planning and Analysis Cell (PPAC) under India's Ministry of Petroleum and Natural Gas shows that the basic customs duty on LPG imported by India's state-owned oil marketing companies for residential consumption, as well as on propane and butane imported for producing residential LPG, is currently zero. As of September 1, 2026, India had approximately 327.75 million active residential LPG connections nationwide.