The current cooking gas (liquefied petroleum gas) shortage affecting some states may worsen during the festival season and affect more areas of the country, reports suggest. The shortage caused by the Yemeni Houthi attacks on Saudi oil installations, forcing the world's biggest exporter to halve the production has been worsened by the recent fire in the Oil and Natural Gas Corporation's (ONGC) plant in Uran, Navi Mumbai.
India's state-run oil marketing companies – Indian Oil Corporation Ltd (IOC), Bharat Petroleum Corporation Ltd (BPCL) and the Hindustan Petroleum Corporation Ltd (HPCL) – are considering rationing of LPG cylinders, a report on the Livemint website says. Users holding only one LPG cylinder would get preference in supply over those having two cylinders, the report says.
"Currently, we are not short of LPG. But there is some disruption in supply due to recent issues with ONGC's Uran plant and Saudi Aramco. We are, however, able to service consumer demand. We are giving priority to single bottle users as double bottle users will have spare capacity," the report quotes an unidentified senior official of an oil marketing company as saying. "We have also arranged for alternative sources for LPG which will reach the Indian shore in a week's time," the official says.
The supply disruption began with a fire in ONGC's Uran processing plant on September 3, the drone attacks on Saudi Aramco's Abqaiq refinery and Khurais oilfield by the Iran-backed Houthi rebels September 11 worsened the shortage. A few LPG processing units of the Mangalore Refinery and Petrochemicals (MRPL) were damaged last month by a landslide during the heavy rain, while some private refiners are under maintenance shutdown.
The demand for LPG has grown significantly after Prime Minister Narendra Modi launched the Pradhan Mantri Ujjwala Yojana (PMUY) in 2016, taking the LPG penetration from 62 percent to around 95 percent. "We had floated a tender (for additional supplies) and we have received a good response so we have tied up more than required cargoes. Supply from Uran is also expected to be restored before October 15 so there will be no demand-supply gap," the report quotes another official from an oil marketing company.
Iran-backed Houthi rebels, who control significant parts of Yemen, targeted the key oil installations of Saudi Arabia's state oil producer Aramco in retaliation to the Saudi-led coalition's attacks on its interests in Yemen. Saudi Arabia has blamed Iran for the attacks though Iran has denied any role. Iran and Saudi Arabia have been locked in a tense standoff ever since US President Donald Trump tore up the Iran nuclear deal.