The impact was particularly significant for India because LPG is widely used as a cooking fuel and the country is the world’s largest LPG importer, according to the CREA report. Unlike crude oil and several other fuels, LPG pricing for much of Asia is closely linked to Saudi Aramco’s monthly contract prices.
The Saudi contract price for LPG rose sharply after the strikes. It increased from $545 per tonne in February to $750 per tonne in April, a 38% rise, and reached $760 per tonne in June before easing to $580 per tonne in July. CREA estimates August’s price at $621 per tonne.
Butane, which accounts for just over half of India’s LPG purchases, saw an even sharper increase. Saudi Aramco’s April announcement raised the official selling price for propane by 38% to $750 per tonne, while the price of butane rose 48% to $800 per tonne.
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India imported less LPG
A substantial reduction in import volumes accompanied the higher prices. India imported 26% less LPG during the six months after the strikes than the market had expected.
Imports fell 49% in March, the first full month of the US-Iran war, compared with the average monthly volume in 2024 and 2025. Supplies subsequently recovered, reaching 86% of the previous two-year average by June.
The supply mix also changed. The US share of India’s LPG imports increased from 8% in February to 16% in March and 32% in April, partly replacing lost Gulf volumes.
| Key metric | Details |
|---|---|
| India’s LPG price premium | 29% above pre-war market expectations |
| Additional LPG import cost | About $1.1 billion |
| Total LPG import bill | About $4.7 billion |
| LPG import volume | 26% lower than expected |
| March import decline | 49% below the 2024-25 average |
| LPG cost per 14.2-kg cylinder | $8.10 at import parity |
| Pre-war expected cylinder cost | $6.28 |
| Additional cost per cylinder | About $1.80 |
| Peak additional cost per cylinder | About $2.90 in May |
| US share of India’s LPG imports | Rose from 8% in February to 32% in April |
| Saudi LPG contract price | Rose from $545/tonne in February to $750/tonne in April |
| Butane price increase | 48%, to $800/tonne in April |
Source: Centre for Research on Energy and Clean Air (CREA)
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$1.1 billion additional import cost
India’s total imported LPG bill during the six-month period was about $4.7 billion. CREA estimates that roughly one-fifth of that represented the additional cost caused by the price shock.
For March to June, the four months for which India had reported trade data, the LPG bill was $788 million above the pre-war market expectation. Across the full six-month period, CREA puts India’s additional LPG import cost at about $1.1 billion.
The report estimates that LPG in a standard 14.2-kg domestic cylinder cost about $8.10 at import parity during March-August, compared with $6.28 under the pre-war expectation. That represents an increase of about $1.80 per refill, or 29%, with the additional cost peaking at about $2.90 in May. These are import-parity figures and do not represent the price actually paid by households, as subsidies, taxes and distribution margins are excluded.
CREA also cautions that its $1.1 billion estimate covers only LPG that India actually purchased. The economic cost of cooking gas that households may have forgone because it became less affordable is not included.
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