India has finalised its first structured contract to source liquefied petroleum gas (LPG) from the United States. The move comes at a time when New Delhi and Washington are edging closer to a long-pending trade agreement.
Union Petroleum and Natural Gas Minister Hardeep Singh Puri announced the agreement on Monday, calling it “a historic first” for one of the world’s fastest-growing LPG markets.
Puri said state-run oil marketing companies (OMCs)—Indian Oil Corporation, Bharat Petroleum Corporation Ltd and Hindustan Petroleum Corporation Ltd—have concluded a one-year deal to import about 2.2 million tonnes per annum (MTPA) of LPG for the contract year 2026. The volume represents nearly 10 percent of India’s annual LPG imports and marks the first structured US LPG supply contract for the Indian market.
New Delhi and Washington are edging closer to a trade agreement. Last week, US President Donald Trump said the two sides were “pretty close” to finalising a deal following five rounds of negotiations. Commerce and Industry Minister Piyush Goyal has emphasised that India will seek a “fair, equitable and balanced” arrangement that protects farmers, workers, and small producers.
Trade talks had faltered earlier this year after Washington imposed a 50 percent tariff on several Indian goods, including a 25 percent punitive duty linked to India’s purchases of Russian oil. New Delhi has since pushed for tariff reductions to help exporters maintain competitiveness against regional peers.
The US has also raised concerns over India’s continued intake of Russian crude, prompting detailed discussions on how to address American apprehensions without jeopardising India’s energy security. The new LPG contract is expected to add momentum to the broader negotiations.