BPCL

By Nidhi Verma and Saurabh Sharma

NEW DELHI, May 21 (Reuters) - Industrial customers in India are increasingly buying diesel from cheaper retail outlets of state-run companies rather than the usual bulk supply points, causing shortages at the pumps in some areas, a government official said.

Diesel sales at pumps in some regions have jumped 20% to 30% as prices for industrial buyers climb to 40 to 42 rupees a litre higher than retail pump prices, said Sujata Sharma, a joint secretary in the federal oil ministry on Thursday.

The retail price of a litre of diesel is 91.58 rupees in New Delhi.

The spike in demand is adding to losses for state-run Indian Oil Corp IOC.NS, Bharat Petroleum Corp BPCL.NS and Hindustan Petroleum Corp HPCL.NS, which are already selling diesel at below market prices for retail customers.

"Bulk customers should take from bulk supply points and retail buyers should go to the petrol pumps," Sharma said.

State fuel retailers are monitoring sales at outlets facing shortages and are seeking support from local authorities and police to curb purchases by bulk consumers, she said.

Preliminary fuel sales data show Indian state retailers' diesel sales from May 1 to 15 surged nearly 11.5% to about 3.8 million metric tons from a year earlier, while gasoline sales rose nearly 19% to 1.8 million tons.

Indian state retailers' diesel sales are also driven by higher prices charged by private fuel retailers and rising consumption from farmers using diesel-powered generators for irrigation during the harvesting season, she said.

BPCL on Thursday said its gasoline sales surged by 16.38% to 1 million kilolitres between May 1 and 20 from a year earlier, while gasoil rose by 16.7% to about 1.7 million kilolitres.

The company said it is focusing on maintaining seamless supplies across smaller cities and remote markets, "where localised demand spikes and precautionary buying tendencies have been observed in recent days".

(Reporting by Nidhi Verma;Editing by Elaine Hardcastle)

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Corrects 8th paragraph to clarify premiums on Russian crude have fallen and not discounts

By Nidhi Verma

NEW DELHI, May 19 (Reuters) - India's state-run refiner Bharat Petroleum Corp. BPCL.NS is recalibrating its crude import strategy almost daily and ramping up spot purchases after the U.S.-Israeli conflict with Iran disrupted Middle East supplies, Chairman Sanjay Khanna said on Tuesday.

India, the world's third-largest oil importer and consumer, has been hit by rising crude prices and supply disruptions following the closure of the Strait of Hormuz. The South Asian nation has raised the retail prices of petrol and diesel twice in a week.

BPCL had planned to source about 55% of its crude requirement for 2026/27 through annual contracts, mainly from Middle Eastern producers, and the rest through spot markets.

But force majeure declarations by some Gulf suppliers have pushed BPCL to increase spot buying to keep refineries running at 115% capacity, Khanna said.

"Definitely, our spot volume has gone up considerably in recent times because of all the uncertainty."

BPCL operates three refineries in India with a capacity to process 706,000 barrels per day of oil.

The state-run refiner meets 40%-45% of its crude needs with Russian oil bought largely in the spot market after Washington granted sanctions waivers, Khanna said, although discounts have narrowed sharply.

Premiums on Russian crude have fallen to $5 to $6 per barrel to dated Brent on a delivered basis from $10 to $12 earlier, finance director Vetsa Ramakrishna Gupta said.

Despite recent fuel price hikes, BPCL continues to incur a revenue loss of 25 to 30 rupees (26 to 31 U.S. cents) per litre on diesel and 10 to 14 rupees per litre on petrol, Gupta said.

BPCL expects spot purchases to ease if Saudi Arabian contracted supplies improve after the restoration of the Kingdom's east-west pipeline capacity.

Saudi Arabia is currently giving only "a small commitment” for supplies through the pipeline, Gupta said.

BPCL is also evaluating annual supply deals with new producers for next year if they offer flexible delivery terms and competitive pricing, although the company prefers sourcing from nearby regions over distant suppliers such as Venezuela and Canada.

The refiner also has an optional annual crude purchase arrangement with Brazil.

Earlier on Tuesday, BPCL reported a 42.6% rise in fourth-quarter profit before exceptional items and tax to 86.07 billion rupees ($892 million), helped by steady fuel demand.

($1 = 96.5325 Indian rupees)

(Reporting by Nidhi Verma; Editing by Hugh Lawson)

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May 19 (Reuters) - India hiked petrol and diesel prices by around 0.9 rupees ($0.0093) per litre on Tuesday, local media reported, in what would be the country's second fuel price hike in a week.

The price of petrol was hiked to 98.64 rupees a litre from 97.77 rupees in Delhi while diesel was increased to 91.58 rupees a litre from 90.67 rupees, media reported.

Last Friday, India raised petrol and diesel prices for the first time in four years by 3 rupees per litre to recoup some of the losses incurred due to higher global crude oil prices.

($1 = 96.3450 Indian rupees)

(Reporting by Chris Thomas in Mexico City)

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Adds share prices of oil companies in paragraph 7

By Nidhi Verma and Chandini Monnappa

NEW DELHI, May 15 (Reuters) - India's state-run fuel retailers have raised petrol and diesel prices for the first time in four years by 3 rupees ($0.03) per litre, or more than 3%, according to dealers, to recoup some of the losses incurred due to higher global crude oil prices.

India - the world's third-biggest oil importer and consumer - is one of the last major economies to raise retail fuel prices following the disruption to shipping through the Strait of Hormuz by the war started by U.S.-Israeli attacks on Iran.

State-run Indian Oil Corp IOC.NS, Hindustan Petroleum Corp HPCL.NS and Bharat Petroleum Corp BPCL.NS, which together control more than 90% of India's 103,000 fuel stations, tend to set diesel and petrol prices in tandem.

A BPCL spokesperson confirmed the price increase at its retail outlets. Indian Oil and HPCL did not immediately respond to a request for comment.

Diesel in Delhi will cost 90.67 rupees a litre and petrol 97.77 rupees, reflecting increases of 3.4% and 3.2%, respectively, from 87.67 rupees and 94.77 rupees a litre.

Global oil prices spiked to more than $120 a barrel, before pulling back to around $100 to $105. O/R

Shares of fuel retailers were down between 2.4% and 3.6% on Friday. Indian Oil Corp IOC.NS fell 2.4%, HPCL HPCL.NS dropped 3.3% and BPCL BPCL.NS was down 3.6% as of 0550 GMT.

The direct impact of the higher fuel prices would be muted at about 15 basis points on consumer price inflation, although the indirect impact will be larger, said Madhavi Arora, chief economist at Mumbai-based Emkay Global Financial Services EMKS.NS.

"The hikes are not enough but could be the start of multiple staggered hikes," she said.

FUEL AUSTERITY STEPS

To curb fuel consumption and rein in oil import bills, New Delhi has rolled out austerity measures as policymakers brace for a prolonged energy shock.

On Sunday, Prime Minister Narendra Modi urged a spate of measures including fuel conservation, work-from-home practices, and limits on travel and imports, as surging global energy prices put pressure on the country's foreign exchange reserves.

Some states have issued notices to government departments this week to restrict travel, avoid physical events and shift meetings online, while also asking them to work from home two days a week, with offices half-staffed.

India is likely to widen the measures to cover millions of employees across the federal government, state-run banks and public sector firms, signalling a system-wide tightening of expenditure and operations as financial risks mount.

The government did not respond to a Reuters email seeking comment.

PRICE INCREASE TO HIT DEMAND

Analysts say the increase is modest and leaves plenty of scope to raise prices further to compensate for revenue losses.

"India's petrol demand growth will be impacted, although the price hike is modest, but other fuel conservation steps such as work from home will dent demand growth," said Prashant Vashisth, vice president and co-head of corporate ratings at Moody's Indian arm, ICRA Ltd ICRA.NS.

ICRA has revised its growth rate for gasoline use to 3%-4% this year compared with 5%-6% before the war, due to the price increase. For gasoil or diesel, ICRA expects growth to be flat from an earlier estimate of 2%-3%.

Analysts and opposition parties said state retailers had delayed raising prices during key state elections. The polls ended this month, with Modi's BJP winning two of four states and expanding its influence.

Oil ministry official Sujata Sharma said in April that higher oil prices after the war started caused Indian retailers to lose about 100 rupees per litre on diesel and about 20 rupees a litre on petrol.

In late March, Russia-backed Indian private refiner Nayara Energy raised its pump prices to mitigate some of its revenue losses from retail sales.

($1 = 95.7625 Indian rupees)

(Reporting by Nidhi Verma, Chandini Monnappa, Ira Dugal, Sarita C Singh and Shivangi Acharya; Additional reporting by YP Rajesh; Editing by Muralikumar Anantharaman, Jamie Freed and Tom Hogue)

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Adds details on price increase from government officials

By Neha Arora and Nikunj Ohri

NEW DELHI, May 12 (Reuters) - India will at some stage need to assess how long state-run fuel retailers can sustain losses from selling transport fuels below market prices, oil minister Hardeep Singh Puri said at an industry event on Tuesday.

Petrol and diesel spot prices have surged to multi-year highs globally as the Middle East conflict disrupted supply, but governments in several major economies have held down pump prices to shield consumers from inflation.

A joint secretary in the oil ministry, Sujata Sharma, had earlier said that India had no plans to ​compensate oil marketing companies for these losses.

Fuel retailers are incurring losses of about 100 rupees ($1.06) per litre on diesel and 20 rupees per litre on petrol, Sharma said last month.

India is the world's third-largest oil importer and ​consumer, meeting more than 90% of its crude oil needs and about half of ⁠its natural gas demand through imports.

Indian state fuel retailers, including Indian Oil Corporation IOC.NS, Hindustan Petroleum HPCL.NS and Bharat Petroleum BPCL.NS, which account for most of the fuel sales in the country, have not raised gasoline and diesel ​prices since April 2022.

A senior government official separately told Reuters that compensating oil marketing companies while keeping fuel prices unchanged is not fiscally sustainable.

Another official said any price increase would be substantial enough to discourage spending on petrol and diesel, but not so large as to sharply stoke inflation.

Both officials spoke on condition of anonymity due to the sensitivity of the matter.

Oil minister Puri also said India has crude and liquefied natural gas sufficient for 60 days, and liquefied petroleum gas for 45 days.

Indian Prime Minister Narendra Modi urged on Sunday a spate of measures including fuel conservation, work-from-home practices and limits on travel and imports to ease pressure on the country's foreign exchange reserves.

The country's balance of payments is expected to worsen sharply during the current 2026-27 fiscal year, with the deficit projected at about $66 billion to $70 billion, up from an estimated $26 billion to $28 billion in 2025-26.

(Reporting by Neha Arora; Writing by Mohi Narayan; Editing by YP Rajesh and Muralikumar Anantharaman)

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Add comments

NEW DELHI, May 4 (Reuters) - India has no plans to compensate state-run fuel retailers for losses from selling transport fuels below market prices, a senior petroleum ministry official said on Monday, even as companies raised prices for some industrial and bulk customers.

Indian state fuel retailers have raised prices of liquefied petroleum gas for industrial customers and jet fuel sold to foreign carriers, but there has been no increase in retail prices of gasoline, gasoil, LPG or jet fuel for Indian carriers.

Indian Oil Corp IOC.NS, Hindustan Petroleum Corp HPCL.NS and Bharat Petroleum Corp BPCL.NS have also raised diesel prices for bulk buyers.

Sharma said bulk customers account for about 10% of overall diesel sales.

The government's efforts are focused on protecting the retail customers, she added.

(Reporting by Nidhi Verma, Editing by Louise Heavens)

((shanima.a@thomsonreuters.com;))

By Nidhi Verma

NEW DELHI, April 28 (Reuters) - India has asked motorists to avoid panic buying and clarified that there was no proposal to raise pump prices for diesel and gasoline, a government official said on Tuesday.

"We have adequate supplies of liquefied petroleum gas, petrol, and diesel. There has been no increase in prices. Please avoid panic buying and do not believe rumours," Sujata Sharma, Joint Secretary in the federal oil ministry, said at a news conference on Tuesday in an appeal to buyers.

India, the world's third-biggest oil importer and consumer, has been hit by rising oil prices triggered by the closure of the Strait of Hormuz after the U.S.-Isreli war on Iran.

India's crude import prices rose to $120 per barrel earlier this month, denting the margins of retailers on the sale of gasoline and gasoil, as the higher costs have not been factored into the pump prices.

Indian refiners have not raised pump prices of gasoline and gasoil in four years to shield consumers, despite volatility in global markets.

Analysts at Kotak Institutional Equities in a recent report estimated there was a need to raise the price of a liter of gasoline and gasoil by 25-28 rupees after elections in some states end on April 29.

According to estimates by Mumbai-based ICICI Securities, profit after tax for these oil retailers likely declined by 82% in the March quarter over a year ago, as crude oil costs soared but retail prices did not move up in tandem.

Reliance Industries RELI.NS, operator of the world's biggest refining complex and India’s biggest company by market value, late last week flagged "unprecedented" supply disruptions and a sharp hit to profit in its March-quarter earnings.

(Reporting by Nidhi Verma; Editing by Chizu Nomiyama)

((nidhi.verma@thomsonreuters.com; X: @nidhi712;))

NEW DELHI, April 27 (Reuters) - Indian Oil Corp's IOC.NS, the country's top refiner and fuel retailers, sale of diesel and gasoline has surged more than 13% during April 1-26, 2026, its head of marketing, Saumitra Priya Srivastava, said in a post on social media platform X

• IOC, the country's top fuel retailer and refiner, is meeting the local demand through its over 42,000 fuel stations, he said

• Diesel sales in some parts, mainly in southern Andhra Pradesh, surged by about 30% to 33%, leading to some retail outlets facing shortages, said Sujata Sharma, a joint secretary in the federal petroleum ministry

• Sharma said India has sufficient stocks of diesel and gasoline, while some retail outlets have experienced problems due to panic buying

• She said India is not expected to import diesel and gasoline to meet local demand

• Earlier in the day, the chief minister of Andhra Pradesh Chandrababu Naidu said in a post on X that action should be taken against anyone attempting to engage in black marketing or to create artificial shortages of diesel and gasoline

  
  

(Reporting by Nidhi Verma, Editing by Louise Heavens)

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NEW DELHI, April 23 (Reuters) - Indian fuel retailers are suffering a revenue loss of 100 Indian rupees ($1.06) per liter on the local sale of diesel and 20 rupees per liter on gasoline for selling the two fuels at below market rates, Sujata Sharma, joint secretary in India's oil ministry said on Thursday.

Indian refiners last raised fuel prices in April 2021. India has no plans to raise fuel prices as of now to shield customers, she added.

($1 = 94.0950 Indian rupees)

(Reporting by Nidhi Verma; Editing by Sharon Singleton)

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By Colleen Howe and Sethuraman N R

BEIJING/NEW DELHI, April 22 (Reuters) - In the rolling, wind-swept grasslands of Chifeng in northern China's Inner Mongolia, towering white wind turbines line hilltops like sentinels over a hydrogen industry Beijing is trying to prise away from coal.

They are part of a $2 billion project - the biggest of its kind - that harnesses renewable energy to run banks of electrolysers that produce the molecules needed for fertilizer, marine fuel and low-emission steelmaking.

India shares China's "green hydrogen" ambitions, but its commitments are even more concrete and aggressive. Backed by subsidies worth some $2.1 billion, New Delhi is targeting 5 million metric tons of green hydrogen annually by 2030 - five times the current size of the global market and about double what analysts estimate Chinese output will be by then.

The massive bets by the world's two most populous nations come at the same time that the West has quietly backed away from its ambitious green hydrogen goals from the start of this decade after cost constraints proved stickier than anticipated.

What China and India have in common - despite very different motives - is the power and political will to force a market into existence, by underwriting projects, steering demand and pushing costs down through scale.

India has drawn private capital by pairing subsidies with offtake guarantees from refineries, fertiliser plants and steelmakers, making projects bankable from the outset.

The motivation is energy security. Hydrogen in India is overwhelmingly derived from imported natural gas, whose supply has suffered a sequence of shocks from the Middle East, Ukraine and the pandemic.

For China - able to deploy state-owned giants or attract private firms with large-scale, planning-led industrial projects - the aim is to preserve its dominance in hydrogen as the industry shifts towards cleaner energy.

In its five-year plan announced in March, Beijing listed green hydrogen alongside quantum computing, brain-computer interfaces and AI-enabled robotics as a frontier industry - an elevation in status that signals more capital will flow its way.

CHINA: SPEED AND SCALE

China invested $3.7 billion in green hydrogen production last year, more than double U.S. levels, said Rystad Energy's head of hydrogen, Minh Khoi Le.

By 2031, China will have some 2.6 million tons per year online, representing $26 billion in investment, according to Rystad projections.

Much of 2025's outlay went into the Chifeng project, operated by Chinese wind turbine maker Envision Energy. It aims to sell green hydrogen and ammonia to markets in Asia, Europe, Latin America and the Middle East, and delivered its first green ammonia cargoes to South Korea's Lotte Fine Chemical in February.

"If we go back a year or two ago, China was not very visible on this situation of green hydrogen, and then two years later they have almost all the biggest projects in the world," said the International Energy Agency's hydrogen lead, Jose Bermudez.

China last year likely doubled its renewables-based hydrogen production capacity to 250,000 tons - more than half of the global total, and surpassing a 2022 target to produce 100,000 to 200,000 tons annually by 2025 - said Agora Energy China managing director Kevin Tu.

In Inner Mongolia and other places with high winds and strong sunlight, costs can fall to around $2 per kilogram for green hydrogen, close to parity with coal-based hydrogen, Tu said. On average, producing green hydrogen in China costs around $4 per kilogram, he said.

INDIA: AGGREGATING DOMESTIC DEMAND

India has brought the price of producing green hydrogen as low as 279 rupees (around $3) per kilogram, from around $5 in 2023, when the government launched the National Green Hydrogen Mission under the clean energy ministry.

Abhay Bakre, who heads the mission, told Reuters that the cost should drop to near $2 by 2032 as technology improves, processes become more efficient and more components are made domestically.

Projects will begin delivering "large quantities" of green hydrogen as soon as next year, he said, and "scale up very fast" to hit the target of 5 million tons by 2030.

Under the initiative, industrial heavyweights including Larsen & Toubro LART.NS, Bharat Petroleum Corp BPCL.NS, GAIL GAIL.NS and JSW Steel JSTL.NS produce about 8,000 tons of green hydrogen and its derivatives annually.

New Delhi is kick-starting demand through state-run reverse auctions, where sellers try to undercut each other to win long-term contracts, effectively revealing the lowest price producers can bear.

The government said last month that suppliers and fertiliser companies had signed offtake agreements for 724,000 tons of green ammonia, which could cover one third of the country's hydrogen requirements.

Maintaining momentum will require "bold, sector-specific domestic initiatives, coupled with strategic international partnerships to unlock export potential", analysts at the Institute of Energy Economics and Financial Analysis wrote in a report.

"With one of the lowest costs of renewable power generation in the world, India is well placed to capture a significant portion of the export market."

(Reporting by Sethuraman NR in New Delhi and Colleen Howe in Beijing; Editing by Kevin Buckland)

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Updates story from April 16 to add market reaction on Friday in paragraph 4, context in paragraphs 7 and 10

By Nidhi Verma, Jaspreet Kalra and Nimesh Vora

NEW DELHI/MUMBAI, April 16 (Reuters) - India's central bank has urged state-run oil refiners to curb spot dollar purchases and tap a special credit line for their foreign exchange needs, three sources said, reviving measures used earlier in the Ukraine war to ease pressure on the rupee.

A surge in oil prices and heavy foreign portfolio outflows have battered the Indian currency. The rupee has fallen more than 3% to record lows this year, making it Asia's worst-performing major currency.

Using the special credit facility would reduce dollar demand from refiners, helping ease pressure on the rupee, two of the sources said. Refiners are major buyers of dollars to pay for oil imports.

When Indian markets opened on Friday morning, the rupee INR=IN strengthened by 0.4% to 92.80 against the dollar, its strongest level in a week.

The state-run refiners have been asked to access the credit line via the State Bank of India, the sources said. SBI is India's largest bank and is state-backed.

Since the large state-run lender already handles sizeable merchant flows, funneling oil-related FX demand through SBI can help reduce the overall market impact, one of the sources said.

The refiners are also being encouraged to route daily dollar purchases through SBI instead of multiple banks, the source said, because pooling dollar demand with one lender would help better manage the market impact.

All three sources declined to be named as they were not authorised to speak to the media. The Reserve Bank of India and SBI did not immediately respond to emails seeking comment.

The credit line is available to major state-run refiners Indian Oil Corp, Hindustan Petroleum Corp and Bharat Petroleum Corp, which together control about half of India's 5.2 million barrels per day of refining capacity.

Refiners can either buy dollars at the RBI reference rate or draw on the credit line for their FX needs, a second source said. The credit line can alleviate immediate dollar demand from the market, supporting the rupee.

None of the refiners responded to emails seeking comment.

Three spot FX traders, separate from the three sources cited earlier, said they had seen an anecdotal decline in the oil companies' activity in the spot market in recent days.

RUPEE STRAIN

The RBI has turned to crisis-era measures, which sources said have been in place for about two weeks, to support the rupee amid pressure linked to the Iran war.

Concerns about spillovers from the conflict helped push the rupee to an all-time low past 95 per dollar in late March.

The central bank has taken other steps to shore up the currency. It has clamped down on arbitrage trades that it said exacerbated market volatility and barred Indian banks from offering corporates non-deliverable forward contracts.

The RBI has also sold dollars from its FX reserves to support the currency.

(Reporting by Nidhi Verma, Jaspreet Kalra and Nimesh Vora; Editing by Mark Potter and Kate Mayberry)

((jaspreet.kalra@thomsonreuters.com; +91-8769636545;))

By Nidhi Verma, Jaspreet Kalra and Nimesh Vora

NEW DELHI/MUMBAI, April 16 (Reuters) - India's central bank has urged state-run oil refiners to curb spot dollar purchases and tap a special credit line for their foreign exchange needs, three sources said, reviving measures used earlier in the Ukraine war to ease pressure on the rupee.

A surge in oil prices and heavy foreign portfolio outflows have battered the Indian currency. It has fallen more than 3% to record lows this year, making it Asia's worst-performing major currency.

Using the special credit facility would reduce dollar demand from refiners, helping ease pressure on the rupee, two of the sources said. Refiners are major buyers of dollars to pay for oil imports.

The state-run refiners have been asked to access the credit line via the State Bank of India, the sources said. SBI is India's largest bank and is state-backed.

All three sources declined to be named as they are not authorised to speak to the media. The Reserve Bank of India and SBI did not immediately respond to emails seeking comment.

The credit line is available to major state-run refiners Indian Oil Corp, Hindustan Petroleum Corp and Bharat Petroleum Corp, which together control about half of India's 5.2 million barrels per day of refining capacity.

The refiners are also being encouraged to route daily dollar purchases through SBI instead of multiple banks, one of the sources said.

With SBI already handling sizeable merchant flows, funneling oil-related FX demand through SBI can help reduce the overall market impact, this person added.

Refiners can either buy dollars at the RBI reference rate or draw on the credit line for their FX needs, a second source said.

None of the refiners responded to emails seeking comment.

Three spot FX traders, separate from the three sources cited earlier, said they had seen an anecdotal decline in the oil companies' activity in the spot market in recent days.

RUPEE STRAIN

The RBI has turned to crisis-era measures, which sources said have been in place for about two weeks, to support the rupee amid pressure linked to the Iran war.

Concerns about spillovers from the conflict helped push the rupee to an all-time low past 95 per dollar in late March.

The central bank has taken other steps to shore up the currency. It has clamped down on arbitrage trades that it said exacerbated market volatility and barred Indian banks from offering corporates non-deliverable forward contracts.

The RBI has also sold dollars from its FX reserves to support the currency.

The rupee has strengthened following the bank's measures, recovering about 2% from its record low. It was last quoted at 93.20 per dollar on Thursday.

(Reporting by Nidhi Verma, Jaspreet Kalra and Nimesh Vora. Editing by Mark Potter)

((jaspreet.kalra@thomsonreuters.com; +91-8769636545;))

April 9 (Reuters) - Bharat Petroleum Corporation Ltd BPCL.NS:

• BPCL- SANJAY KHANNA HAS BEEN APPOINTED AS CHAIRMAN & MANAGING DIRECTOR OF CO

Source text: ID:nnAZN4SPWU1

Further company coverage: BPCL.NS

((Reuters.Briefs@thomsonreuters.com;))

Adds Nayara Energy refinery shutdown in paragraphs 3-4

April 6 (Reuters) - Indian refiners have postponed maintenance shutdowns of their units to meet local fuel demand, a government official said on Monday.

Indian Oil Corporation IOC.NS and Bharat Petroleum Corporation BPCL.NS were among the companies that had planned to shut units at some of their refineries for routine maintenance, Sujata Sharma, joint secretary in the federal oil ministry said.

However, Nayara Energy will shut its 400,000 barrels per day Vadinar refinery for maintenance from April 9, tightening supply of liquefied petroleum gas in the country, she said.

Nayara was originally scheduled to shut the refinery for a month-long maintenance last year but had to postpone the plan as European Union sanctions made it difficult to secure key items required for the turnaround.

(Reporting by Nidhi Varma, writing by Shilpa Jamkhandikar; Editing by Toby Chopra)

((shilpa.jamkhandikar@thomsonreuters.com;))

By Nidhi Verma

NEW DELHI, April 2 (Reuters) - India is using a cooking gas crisis triggered by the Iran war to plug leaks in its local distribution chain and strengthen infrastructure to expedite a shift towards piped gas as it looks to reduce liquefied petroleum gas imports and spending on subsidies.

The government has invoked emergency powers to ensure that limited LPG supplies are directed toward actual household use and will halt supplies after three months for customers linked to piped gas connections.

Last month, India issued an order setting timelines for new pipeline approvals, with permissions deemed granted if authorities fail to respond in time, while requiring landowners and local authorities to allow pipeline access.

"Witness rapid expansion of CGD (city gas distribution) network across the country ... a crisis turned into an opportunity", said Neeraj Mittal, the secretary of the Ministry of Petroleum and Natural Gas, on social media.

In March, India added 580,000 new households to its piped gas supply network, the government said on Tuesday, compared with 342,300 a year earlier.

India is the world's No. 2 importer of LPG, meeting about 60% of its needs with overseas purchases. It shipped in about 22 million metric tons of LPG in 2025, mostly from the Middle East, spending nearly $12 billion.

LPG DISRUPTION EXPOSES IMPORT DEPENDENCE

The world's most populous country has been hit hard by LPG supply disruptions, exposing vulnerabilities in its import-dependent energy system and prompting officials to take steps to manage supply and demand.

India's LPG imports could decline by about 10% to 15% by 2030 due to the measures, including the expansion of piped gas, said Prashant Vashist of credit-rating agency ICRA.

India satisfies half of its natural gas consumption with imports of liquefied natural gas.

"This (shift to natural gas) would cut the companies' revenue losses on the sale of domestic LPG and would also reduce the subsidy burden," he said.

Shifting consumers to piped gas, which is sold closer to market rates, would help contain fiscal pressures while improving supply efficiency.

Retailers sell LPG to commercial users at market prices, while selling cooking fuel to households at subsidised rates that are about 56% cheaper. Last year, a limited compensation to retailers cost the government $3.4 billion.

Since the start of the war, suppliers including Indraprastha Gas IGAS.NS, Mahanagar Gas MGAS.NS, GAIL Gas and Bharat Petroleum Corp BPCL.NS have offered incentives such as reductions in installation charges for piped gas connections.

India has 333.7 million household LPG customers including 106 million low-income families receiving subsidised gas.

Local gas suppliers have been connecting about 2 million to 2.5 million consumers annually, bringing the total to 16.3 million at the end of December.

The recent policy changes should raise that pace to about 7.5 million connections annually, said Gajendra Singh, former member of the Petroleum and Natural Gas Regulatory Board, bringing the national total to 35 million to 40 million by 2030.

"This expansion would cut LPG imports and offer a safer, more convenient alternative for households," he said.

(Reporting by Nidhi Verma; Editing by Tony Munroe and Thomas Derpinghaus)

((nidhi.verma@thomsonreuters.com; X: @nidhi712;))

BENGALURU, March 29 (Reuters) - Two India-bound liquefied petroleum gas tankers carrying about 94,000 metric tons of the cooking gas have safely transited the Strait of Hormuz and are heading towards India, the government said on Sunday.

The carriers BW Tyr and BW Elm are expected to arrive in Mumbai on March 31 and New Mangalore on April 1 respectively, the petroleum ministry said in a statement.

The U.S.-Israeli war against Iran has all but halted shipping through the strait, but Iran has said "non-hostile vessels" may transit the waterway if they coordinate with Iranian authorities.

The ships are the latest Indian-flagged vessels to make it through the chokepoint. Four LPG tankers have already completed the crossing, while three more are still in the western section of the strait, LSEG ship tracking data showed on Friday.

A total of 18 Indian-flagged vessels with 485 Indian seafarers remain in the western Gulf region, the government said.

India, the world's second-largest LPG importer, last year consumed 33.15 million tons of the gas, with imports accounting for about 60% of demand. About 90% of those imports came from the Middle East.

Port operations across India remain normal with no congestion reported, the government said.

(Reporting by Munsif Vengattil in Bengaluru. Editing by Mark Potter)

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By Nidhi Verma

NEW DELHI, March 28 (Reuters) - Two liquefied petroleum gas tankers, BW Elm and BW Tyr, are crossing the Strait of Hormuz bound for India, according to ship tracking data from LSEG and Kpler.

The U.S.-Israeli war against Iran has all but halted shipping ​through the strait, but Iran said this week that "non-hostile vessels" may transit the waterway if ‌they coordinate with Iranian authorities.

The two India-flagged vessels have crossed the Gulf area and are in the eastern Strait of Hormuz, the data showed.

India is gradually moving its stranded LPG cargoes out from the strait, with four LPG tankers moved so far - Shivalik, Nanda Devi, Pine Gas, and Jag Vasant.

As of Friday, 20 Indian-flagged ships including five LPG carriers were stranded in the Gulf, Rajesh Kumar Sinha, special secretary in the federal shipping ministry, said.

LPG carriers Jag Vikram, Green Asha and Green Sanvi are still in the western Strait of Hormuz, LSEG data show.

India, the world's second-largest LPG importer, is battling its worst gas crisis in decades, with the government cutting supplies for industries to shield households from any shortage of cooking gas.

The country consumed 33.15 million metric tons of LPG, or cooking gas, last year, with imports accounting for about 60% of demand. About 90% of those imports came from the Middle East.

India is also loading LPG onto its empty vessels stranded in the Gulf.

(Reporting by Nidhi Verma; Editing by Jan Harvey)

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Adds details on fiscal impact

By Chris Thomas and Nikunj Ohri

NEW DELHI, March 27 (Reuters) - India has slashed excise duties on petrol and diesel to protect consumers and curb a potential spike in inflation, while imposing windfall taxes on aviation fuel and diesel exports, amid volatile global oil markets due to the Iran war.

Global oil prices have surged past $100 per barrel after the near closure of the Strait of Hormuz, which ​serves as a conduit for 40% of India's crude oil imports, since the U.S. and Israel first struck Iran on February 28.

In a government order late Thursday, India's finance ministry reduced the special excise duty on petrol to 3 rupees ($0.0318) per litre from 13 rupees. It also cut the duty on diesel to zero from 10 rupees per litre.

The move comes ahead of elections next month in four Indian states and one federal territory, with voters very sensitive to higher prices.

India will lose 70 billion rupees ($739 million) a fortnight from the excise cuts, although it will recover part of this - 15 billion rupees - through separate export taxes on some fuel products, Vivek Chaturvedi, chairman of Central Board of Indirect Taxes and Customs, told a press briefing.

The net hit to government finances will be 55 billion rupees per fortnight.

The yield on 10-year government bonds rose 7 basis points to 6.95%, its highest level in 20 months on concerns that the government may struggle to meet its fiscal deficit target of 4.3% of GDP for the financial year beginning April.

The tax cuts also ease the burden for oil marketing companies. While fuel prices in India are technically deregulated, state-run oil companies, which control 90% of the retail network, do not always raise prices when crude climbs.

As a result, consumers are shielded from volatility, with either the government or the companies absorbing the increases.

"Government has taken a huge hit on its taxation revenues to ensure very high losses of oil companies, approximately 24 rupees a litre for petrol and 30 rupees a litre for diesel, at this time of sky high international prices, are reduced," Oil Minister Hardeep Singh Puri said in a post on X.

The government said that at current crude rates, the combined daily under-recoveries being absorbed by oil firms stand at 24 billion rupees.

Shares of oil marketing companies such as Bharat Petroleum Corp BPCL.NS and HPCL HPCL.NS reversed early gains to close slightly higher.

WINDFALL TAX ON EXPORTS

The diesel export tax was set at 21.5 rupees a litre, along with a 29.5 rupees a litre tax on aviation fuel exports, the order said.

Between April 2025 and January 2026, India exported 14 million metric tons of gasoline and 23.6 million tons of gasoil. Most refiners have stopped exporting fuels. Reliance Industries RELI.NS is the country's biggest fuel exporter.

Finance Minister Nirmala Sitharaman said the government will ensure there is no shortage of petrol, diesel and jet fuel.

It will support oil marketing companies so that citizens are spared price hikes and ensure that jet fuel prices do not rise, she told news agency ANI.

India, the world's third-biggest oil importer and consumer, relies heavily on overseas supplies.

In a letter dated Thursday, the petroleum ministry said it will raise the allocation of liquefied petroleum gas to commercial and industrial users by 20%, taking total supply to 70% of pre-crisis levels.

The increase builds on an existing 50% allocation, with priority to sectors such as steel, automobiles, textiles and other essential industries. India had cut gas allocation for non-cooking purposes after the start of the Iran war.

India consumed 33.15 million tons of cooking gas last year, with imports covering about 60% of demand. About 90% of those imports came from the Middle East.

Prime Minister Narendra Modi and his government have stressed adequate arrangements are in place, including for fertiliser supplies for the summer sowing season and coal to meet rising electricity demand.

The government, in a separate statement, assured the public that retail petrol and diesel prices will not change.

($1 = 94.1980 Indian rupees)

(Reporting by Chris Thomas and Nikunj Ohri. Additional reporting by Tanvi Mehta, Aditi Shah and Rajesh Kumar Singh. Editing by YP Rajesh, Arun Koyyur and Mark Potter)

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By Nidhi Verma

NEW DELHI, March 26 (Reuters) - Russia-backed Indian private refiner Nayara Energy has raised pump prices of gasoline and gasoil, petrol pump dealers said on Thursday, to mitigate some of its revenue losses from retail sales.

Indian refiners, hit hard by a declining rupee and rising oil prices, are facing revenue losses from retail sales as cracks for gasoline GL92-SIN-CRK and gasoil GO10SGCKMc1 surged to multi-year highs.

Nayara, India's top private fuel retailer, has raised the price of gasoline by 5 rupees per litre to 100.71 rupees ($1.07), and gasoil by 3 rupees to 91.31 rupees, the dealers said.

Nayara, which sells gasoline and gasoil through its 6,697 retail outlets, plans to shut its 400,000 barrels per day (bpd) Vadinar refinery from April 10 for a month-long maintenance.

Apart from direct sales to customers, the private refiner also sells fuels to the state refiners after it was sanctioned by the European Union last year for links with Russian entities, including oil major Rosneft.

No immediate comment was available from Nayara.

Indian refiners are facing a revenue loss of more than 50 rupees per litre on gasoil and about 20 rupees on gasoline for selling fuels at below-market rates to cushion customers from a spike in global markets, industry sources said.

Indian state refiners have not raised the retail prices of gasoline and gasoil despite a surge in global oil prices LCOc1 to more than $100 per barrel as the supplies through the Strait of Hormuz are disrupted by the US-Israel war on Iran.

About 90% of the country's 101,470 retail fuel stations are linked to state refiners and retailer Indian Oil Corp IOC.NS, Bharat Petroleum Corp BPCL.NS and Hindustan Petroleum Corp HPCL.NS.

($1 = 94.1040 Indian rupees)

(Reporting by Nidhi Verma; Editing by Arun Koyyur)

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Recasts headline and story, adds bullet points and details

By Nidhi Verma

NEW DELHI, March 25 (Reuters) - India has bought its first cargo of Iranian liquefied petroleum gas in years after the U.S. temporarily removed sanctions on Tehran's oil and refined fuels, LSG trade flows and three industry sources said.

India had shunned energy purchases from Iran in 2019 under pressure from Western sanctions. The tanker was initially bound for China, according to LSEG data.

Sanctioned tanker Aurora carrying Iranian LPG is expected to shortly reach the west coast port of Mangalore, the sources said and LSEG data showed.

The South Asian nation has been hit hard by the disruption of energy shipments via the Strait of Hormuz caused by the U.S.-Israeli war with Iran.

THREE RETAILERS TO SHARE LPG CARGO

The Iranian LPG cargo will be shared among the three fuel retailers, Indian Oil Corp IOC.NS, Bharat Petroleum Corp BPCL.NS, and Hindustan Petroleum Corp HPCL.NS.

The cargo has been purchased from a trader, and payment will be made in rupees, the sources said, adding India is exploring buying more Iranian LPG cargoes.

Still, an official said he was not aware of Iranian cargoes being bought.

"(There are) no loaded cargoes from Iran, we have not heard of that," said Rajesh Kumar Sinha, special secretary in the federal shipping ministry said Wednesday at a press conference.

The three companies and India's oil ministry did not immediately respond to Reuters requests for comments.

MOST OF IMPORTED LPG FROM MIDDLE EAST

The world's second-largest LPG importer is battling its worst gas crisis in decades with the government cutting supplies for industries to shield households from any shortage of cooking gas.

India consumed 33.15 million metric tons of LPG, or cooking gas, last year, with imports accounting for about 60% of demand. About 90% of those imports came from the Middle East.

India is gradually moving out its stranded LPG cargoes from the Strait of Hormuz, with four LPG tankers moved so far--Shivalik, Nanda Devi, Pine Gas, and Jag Vasant.

India is also loading LPG onto its empty vessels stranded in the Persian Gulf.

(Reporting by Nidhi Verma; Editing by Bernadette Baum)

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Adds confirmation from company

By Nidhi Verma

NEW DELHI, March 24 (Reuters) - India's state-run Bharat Petroleum Corp BPCL.NS has appointed its international trade head, Manoj Heda to lead its Singapore-based trading unit, the company said on Tuesday.

BPCL incorporated a wholly-owned unit Bharat Petroleum Global Energy Services (Singapore) Pte. Ltd., on February 26, 2026, in Singapore, it said.

The new entity will set up a "trading desk for trading in crude oil, natural gas, petroleum and other petrochemical products" and associated activities, it said.

The unit is expected to start operations in April, sources said earlier on Tuesday.

Manish Parikh will be the chief financial officer, the sources added.

The sources declined to be identified as the appointments have not been publicly announced.

Heda, who joined BPCL in 1999 as a senior manager for finance, has been an executive director for international trade and risk management since May 2023, according to his LinkedIn profile.

BPCL Chairman Sanjay Khanna in January said that the new entity will help identify opportunities to buy crude for BPCL and also expand the company's presence in the trading of liquefied natural gas and refined fuels.

BPCL controls about 706,000 barrels per day of crude capacity across three refineries and is looking to build a new refinery in the southern Indian state of Andhra Pradesh.

(Reporting by Nidhi Verma; Editing by Edwina Gibbs)

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Recasts with comments from oil ministry

By Nidhi Verma

March 19 (Reuters) - India, the world's fourth-largest refiner, will review its fuel exports if needed to ensure availability in the local markets, a government official said on Thursday, amid global disruption and soaring oil prices stemming from the Iran war.

"Domestic consumption is priority, and the government will review (the export plan)," Sujata Sharma, a joint secretary in the federal petroleum ministry told a news conference.

India has ordered oil and gas companies to share full details of exports, imports and inventories with a government agency, as the South Asian nation seeks to shield consumers from shortages.

India has designated the Petroleum Planning and Analysis Cell to compile the information and all companies must share information regardless of any confidentiality obligations.

India has been hit hard by the jump in crude prices and disruption in oil and gas supplies, but unlike China it has not moved to ban exports of refined fuels.

The data will help India in taking faster and "more targeted interventions such as imposing export restrictions or calibrating export flows to meet its own energy security", said Prashant Vashisth, vice president at Moody's affiliate ICRA.

He said India can use its excess refining capacity to prioritise fuel supply to friendly or strategically aligned countries after meeting its local demand.

"Nowadays buyers are willing to pay a higher price. The question is of availability, which is beginning to outweigh prices," Vashisth said.

Any move to curtail fuel exports by India will hit Reliance Industries RELI.NS, the operator of the world's biggest refining complex, as other refiners have largely stopped exporting fuels.

All companies involved in the oil and gas supply chain including oil producers, importers, refiners, fuel and gas retailers, liquefied natural gas importers, pipeline operators, and petrochemical plants were ordered to provide PPAC with data.

India, the world's third-biggest oil importer and consumer, meets over 90% of its oil needs through purchases from overseas.

So far the federal government has said there are adequate crude supplies and refined fuel stocks to meet local demand.

However, the world's second-largest LPG importer is facing its worst cooking gas crisis in decades with shipments from the Strait of Hormuz almost halted due to the war.

India was sourcing more than 40% of its crude imports and 90% of its liquefied petroleum gas imports from the Middle East.

Indian refiners have bought millions of barrels of Russian oil floating on the high seas after Washington granted a sanctions waiver.

The country has invoked emergency powers ordering refiners to maximise production of LPG and cut sales to industry to avoid a shortage for its 333 million homes with LPG connections.

India last week asked consumers to avoid panic buying of LPG cylinders and shift to piped natural gas where possible.

(Reporting by Akanksha Khushi in Bengaluru; Editing by Andrew Cawthorne, Deepa Babington, Kevin Buckland, Alexandra Hudson)

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By Nidhi Verma

NEW DELHI, March 17 (Reuters) - Indian state-owned fuel retailers are seeking advance payments for gasoline and gasoil supplied to fuel pumps nationwide, dealers said, as the companies are suffering significant revenue losses from retail sales.

About 90% of the country's 101,470 retail fuel stations are linked to state refiners and retailer Indian Oil Corp IOC.NS, Bharat Petroleum Corp BPCL.NS and Hindustan Petroleum Corp JPCL.NS.

Indian refiners, hit hard by a declining rupee, are facing revenue losses from retail sales as cracks for gasoline GL92-SIN-CRK and gasoil GO10SGCKMc1 surged to multi-year highs.

India has not raised the retail prices of gasoline and gasoil to shield consumers despite a surge in global oil prices LCOc1 to over $100 per barrel as the supplies through the Strait of Hormuz are disrupted by the US-Israeli war on Iran.

The three fuel retailers did not respond to Reuters email seeking comments.

The state refiners were previously giving a five-day credit to the dealers for the sale of gasoline and gasoil, dealers said.

"Dealers are very upset because we also run our business on credit, and some dealers sell fuel to the clients, such as government departments and transporters, on a credit basis," said Ajay Bansal, President of All India Petroleum Dealers Association, which represents about 92,000 fuel stations in the country.

(Reporting by Nidhi Verma; Editing by Michael Perry)

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Updates

** Indian oil marketing companies' (OMC) shares extend drop on rising oil prices as investor focus returned to threats facing Middle East oil facilities

** Hindustan Petroleum Corp HPCL.NS falls 4.2%, Indian Oil Corp IOC.NS sheds nearly 5%, BPCL BPCL.NS down 4.3%

** Indian OMC's have lost about 20% since the conflict between the US-Israel alliance and Iran began on February 28

** Higher oil prices weigh on the margins of OMCs

** HSBC Global Investment Research downgrades all three stocks to "hold" from "buy" citing higher crude prices pressuring earnings

** Lowers PT to 150 rupees for IOC from 180 rupees, 300 rupees from 370 rupees for BPCL and 290 rupees from 350 rupees for HPCL, respectively

** For FY26e, expect IOC, BPCL, and HPCL to have marketing losses to the tune of 150–170 billion rupees before inventory gains/impact - HSBC

(Reporting by Brijesh Patel in Bengaluru)

((Brijesh.Patel1@thomsonreuters.com; Ph no. +91 9590227221;))

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

By Shritama Bose

MUMBAI, March 11 (Reuters Breakingviews) - India's hunger for energy imports remains its Achilles heel. Pair that with a war roiling the petro-states of the Gulf, home to some 10 million Indian expatriates who account for 38% of the country's inward remittances, and it's easy to see why the U.S.-Israel war against Iran has put the world's fifth-largest economy on edge.

Opposition politicians jeered Subrahmanyam Jaishankar, India's foreign minister, on Monday during his speech in parliament on the conflict after crude shot up to $119 a barrel and the Indian rupee hit a fresh low of 92.35 against the U.S. dollar. It was already the worst-performing major Asian currency in 2025.

There will be limited relief from Washington's green light for Indian companies including Reliance Industries RELI.NS to buy otherwise-sanctioned Russian oil. Juicy discounts on that supply narrowed long ago, and now there will be more competition from other buyers.

And in a situation of very limited supply, India's stockpile can only meet its needs for 25 days, per a Reuters report citing refining sources. India's demand for liquefied natural gas is a problem too. It imports 80% of its needs from the Middle East. New Delhi on Tuesday curbed supply to industries, a day after extending waiting periods for cooking gas.

India has multiple levers it can pull to shield consumers from any price shock. New Delhi can ask state-backed fuel retailers like Bharat Petroleum BPCL.NS and Indian Oil IOC.NS to absorb the increased cost. At a pinch, the government could cut excise duties, albeit at the cost of a wider budget gap. Inflation in India is also low: retail prices grew 2.75% year-on-year in January.

Protecting the rupee, however, is harder. Bigger fiscal deficits in national accounts will hurt. India's central bank intervened on Monday to stem the currency's slide. Though the price of oil receded to $92 per barrel after U.S. President Donald Trump claimed the war would be over "very soon", it remains volatile. If it held at $100 per barrel for three months, India’s current account deficit could rise to 2% of GDP from the baseline assumption of 1.6%, according to Gaura Sengupta, an economist at IDFC First Bank. That would be close to the 2.3% level clocked in 2008-09, soon after the global financial crisis.

India's currency is already suffering from weak net foreign direct investment and capital outflows, in part because of worries about the threat new artificial intelligence tools pose to India's services exports. A prolonged war in the Middle East will really grease the rupee's problems.

Follow Shritama Bose on LinkedIn and X.

CONTEXT NEWS

India does not expect inflation to rise substantially from a jump in global crude oil prices triggered by the war in the ​Middle East, as domestic price levels remain near the lower end ‌of the central bank's tolerance band, Finance Minister Nirmala Sitharaman said on March 9.

The Indian rupee fell to an all-time low of 92.3475 against the U.S. dollar on the same day, as surging crude prices sparked concerns over growth and ​inflation in the world's fifth-largest economy.

(Editing by Una Galani; Production by Aditya Srivastav)

((For previous columns by the author, Reuters customers can click on BOSE/shritama.bose@thomsonreuters.com))

By Sethuraman N R

NEW DELHI, March 10 (Reuters) - India will likely lean more on its coal capacity to meet peak power demand this summer as liquefied natural gas supplies tighten after shipping disruptions linked to the U.S.-Israeli war on Iran hit exports from major producers, two industry officials said.

New Delhi typically pushes power plants to ramp up generation during the April-June summer months, including costly gas-fired generation, to meet surging electricity demand and subsidises the cost for companies to shield customers from higher prices.

But so far the government has received no bids from power companies to supply 12,000 megawatt-hour of gas-based power for the summer months, an official with knowledge of the matter said. The tender will close in the next two days.

A second official said the power ministry is looking to bring coal plants out of planned outages and advising generators to avoid shutdowns during the peak summer months.

Top utility NTPC NTPC.NS has already told India's grid regulator it will not be able to supply gas-fired power during the April–June summer months, two company sources said.

NTPC and the federal power ministry did not respond to Reuters emails seeking comment.

EMERGENCY PROVISIONS

India has invoked emergency provisions and declared force majeure, reprioritising natural gas supplies to key sectors such as households and fertiliser plants.

India's Petronet LNG Ltd PLNG.NS, the country's top gas importer, has also issued a force majeure notice to customers including top power suppliers GAIL (India) Ltd, Indian Oil Corp IOC.NS and Bharat Petroleum Corp BPCL.NS after supplies from Qatar and Abu Dhabi National Oil Company were halted.

The country has about 20 gigawatts (GW) of gas-based generation capacity, which typically operates at 6-10% utilisation due to costly LNG, but rises to about 30% during the summer months.

Even if peak demand reaches 250–260 GW this summer, India is unlikely to face material power cuts given ample coal, lignite, nuclear, hydro and wind capacity, said Gautam Shahi, senior director at Crisil Ratings.

India relies on coal power for nearly 75% of its power generation.

"India's thermal coal market is seeing steady import demand, particularly for coal grades used by power producers," said Vasudev Pamnani, director at Gujarat-based coal trader i-Energy Resources.

(Reporting by Sethuraman NR; Editing by Saad Sayeed)

((Sethuraman.NR@thomsonreuters.com; (+91 9945291420); Reuters Messaging: nallur.sethuraman.thomsonreuters.com@reuters.net/))

Adds details throughout

March 9 (Reuters) - Indian refiners slumped on Monday as a widening U.S.-Israeli war with Iran pushed Brent crude to a nearly four-year high, threatening their near-term earnings and raising the risk of further government intervention.

State-run Indian Oil IOC.NS dipped 4.6%, Hindustan Petroleum HPCL.NS slid 4.9% and Bharat Petroleum BPCL.NS dropped 5.4%, with BPCL heading for its steepest fall since June 2024.

The rout dragged the Nifty oil and gas index .NIFOILGAS down 2.7% and the energy index .NIFTYENR 2.1% lower, while the benchmark Nifty 50 .NSEI slid 2.8%. The oil and gas index has fallen 6.6% since the U.S.-Israeli strike on Iran last week.

India's top refiner Reliance Industries RELI.NS was down 0.4% after slipping 2.5% earlier.

UBS said Indian oil marketing companies are exposed to the crude spike because their fuel sales far exceed their production - roughly double for IOC and BPCL, and even more for HPCL.

The brokerage downgraded IOC and BPCL to "neutral" and HPCL to "sell" from "buy".

It also reduced fiscal 2027 profit estimates by 19% for IOC, 15% for BPCL and 46% for HPCL.

RISKS OF PROLONGED CONFLICT

Oil prices surged about 26% to $119.5 per barrel - the highest since July 2022 - as some major producers cut supplies and fears ​of prolonged shipping disruptions gripped the market.

Iraq and Kuwait have begun reducing oil output, adding to earlier liquefied natural gas (LNG) cuts from Qatar as the war disrupted shipments out of the Middle East.

Citi on Monday warned refiners' earnings will hinge on how long the geopolitical shock persists, flagging risks from any potential closure of the Strait of Hormuz and shutdowns in Qatar's LNG output - each supplying roughly half of India's crude and LNG needs.

India, the world's second-biggest importer of LPG, consumed 33.15 million metric tons of the cooking gas last year, with imports meeting about two-thirds of demand. Middle Eastern suppliers account for 85%-90% of India's LPG inflows.

New Delhi on Friday invoked emergency powers directing refiners to maximise liquefied petroleum gas production to prevent a cooking-gas shortage following supply disruptions.

Prolonged turmoil could force additional government intervention, including export curbs, duties on refined products or direct budgetary support, Citi added.

Meanwhile, Indian companies raised LPG prices for the first time in about a year on Friday, tracking global benchmarks as the war crimps flows from the Middle East.

India imports more than 80% of its crude oil needs and is the world's third largest oil importer.

(Reporting by Kashish Tandon and Yagnoseni Das in Bengaluru; Editing by Sumana Nandy)

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By Nidhi Verma

NEW DELHI, March 6 (Reuters) - India has asked all its refiners to maximise production of liquefied petroleum gas and make the fuel available only to three state-run companies - Indian Oil, HPCL and BPCL, a government order showed.

Thursday's order also asked refiners not to use propane and butane for petrochemical production and ordered the public sector companies to sell LPG to domestic customers only.

Liquefied Petroleum Gas is a combination of propane and butane.

(Reporting by Nidhi Verma; Editing by Clarence Fernandez)

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By Nidhi Verma and Jarrett Renshaw

NEW DELHI/WASHINGTON, March 5 (Reuters) - Indian refiners are buying millions of barrels of prompt Russian crude oil cargoes as the South Asian nation seeks to navigate an oil supply crunch triggered by the Middle East conflict, six sources familiar with the matter said.

For months, the U.S. has pressured New Delhi to avoid buying Russian barrels as Washington seeks to reduce money flowing to Moscow's war effort in Ukraine.

India is vulnerable to energy supply shocks, with crude stocks covering only about 25 days of demand. India gets about 40% of its oil imports from the Middle East through the Strait of Hormuz.

India was the top buyer of Russian seaborne crude after Moscow's 2022 Ukraine invasion, but in January, its refiners started to reduce purchases under pressure from Washington.

Cutting Russian oil purchases helped New Delhi avoid 25% tariffs and clinch an interim trade deal with the U.S.

It is unclear whether the United States has allowed India to increase Russian purchases to offset potential Middle Eastern supply losses.

A source directly invloved with the matter said India had approached U.S. President Donald Trump's administration seeking approval to buy Russian crude imports due to the Iran conflict.

India's oil and foreign ministries did not respond to Reuters emails seeking comments. The White House and the U.S. Treasury Department did not immediately respond to requests for comment.

State refiners Indian Oil Corp IOC.NS, Bharat Petroleum Corp BPCL.NS, Hindustan Petroleum Corp HPCL.NS and Mangalore Refinery and Petrochemicals Ltd MRPL.NS are talking to traders for prompt delivery of Russian cargoes, according to the Reuters sources.

One of the sources said Indian state refiners have bought about 20 million barrels of Russian oil from traders so far.

HPCL and MRPL last received Russian oil in November, according to data obtained from industry sources.

The traders are selling Russian Urals to India at a premium of $4-$5 per barrel to Brent on a delivered basis for arrival at Indian ports in March and early April, three of the sources said.

This is in contrast to a discount of about $13 per barrel for cargoes traded in February, traders said.

HPCL had bought two cargoes of Russian oil at a $13 discount before the war started on February 28.

"India refiners are back in the market...nowadays more than prices, availability of molecules is the issue," said one of the traders involved in Russian oil sales to India.

This source said Reliance Industries RELI.NS also approached his company for purchase of prompt Russian oil cargoes.

Refiners in India had already started tapping Russian oil aboard vessels floating off the country's coast to make up for the loss of Middle Eastern crude, two sources with direct knowledge of the matter said earlier in the day.

Indian refiners did not immediately respond to Reuters emails sent out after business hours.

(Reporting by Nidhi Verma in New Delhi and Jarrett Renshaw in Washington; Editing by David Gregorio)

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Recasts, adds details from sources

By Nidhi Verma

NEW DELHI, March 4 (Reuters) - Several Indian companies have restricted the domestic supply of natural gas, including to the important fertiliser sector, under a force majeure clause due to an escalating conflict in the Middle East, gas importers and sources said on Wednesday.

The U.S and Israel's air war on Iran has disrupted fuel shipments in the region, affecting India's key supplier of liquefied natural gas, Qatar.

Sources familiar with the matter said lower gas supplies had already marginally hit production of some fertiliser companies including the Indian Farmers Fertiliser Cooperative Ltd and Kribhco Fertilizers Ltd.

The two companies did not respond to Reuters' request for comment outside normal working hours.

Gujarat Gas Ltd, which supplies gas for domestic and industrial clients, said in a stock exchange filing that it had declared a force majeure to restrict gas supplies to industries from Thursday. Its parent company, GSPC, gets most of the gas from Qatar and Abu Dhabi National Oil Co for sale to local customers.

India's top gas importer Petronet LNG Ltd PLNG.NS issued a force majeure notice to its supplier, QatarEnergy, and to local buyers GAIL (India) Ltd GAIL.NS, Indian Oil Corp IOC.NS, and Bharat Petroleum Corp BPCL.NS, after its three LNG tankers were unable to reach the Ras Laffan loading port, it said in an exchange filing.

GAIL and IOC have already reduced gas supplies to industries, Reuters reported on Tuesday.

QatarEnergy has also issued a notice to Petronet "indicating a potential event of force majeure" due to the hostilities in the region, the Indian company said.

So far the companies have not announced any cuts in gas supplies for households or the automobile sector.

India imported 27 million tonnes of LNG in 2024/25, about half of its overall gas consumption, according to the government data. The bulk of the LNG is imported from Qatar.

As a result of the attacks on Iran and Tehran's retaliatory strikes, transit through the Strait of Hormuz between Iran and Oman, which carries around one-fifth of oil consumed globally, as well as large quantities of liquefied natural gas, has ground to a near-halt after some vessels in the area were hit.

(Reporting by Nidhi Verma; Editing by Nivedita Bhattacharjee and Andrei Khalip)

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