Twenty percent of Mumbai’s restaurants have already shut their kitchens. Not because of a health scare or a licensing crackdown — because they can’t get cooking gas.
India’s LPG crisis went from policy briefing to street-level reality in under a week. The Strait of Hormuz — the narrow shipping corridor that carries 85–90% of India’s LPG imports — is effectively closed after the US-Israel strike on Iran and Tehran’s retaliation. Weekly imports have dropped nearly 30%.
Here’s the number that makes this a crisis and not just a headline: India consumed 31.3 million tonnes of LPG last year but produced only 12.8 million tonnes domestically. That’s a 56% import gap — and most of it just got blocked.
Who’s Feeling It First
Not households. Not yet.
The government invoked the Essential Commodities Act on March 5, ordering refineries to maximize domestic LPG output and prioritize household supply—part of the broader policy framework outlined in the Union Budget 2026 aimed at stabilizing essential commodities and managing inflation. That means commercial users — restaurants, hotels, crematoriums — are absorbing the hit.
The cascade has been brutal. Mumbai’s Aahar hotel association warns 50% of the city’s restaurants could close within days. Bengaluru and Chennai are reporting similar shutdowns. Pune’s municipal corporation shut 22 gas-fired crematoriums, forcing families to use electric or wood-fired alternatives.
When a city can’t cremate its dead with gas, “shortage” undersells it. This kind of supply shock compounds the broader inflation constraints that emerged in Q3 2026 GDP data, where retail prices and rural consumption already faced significant headwinds.
What It Costs You
Domestic cylinders are already up ₹60 — from ₹853 to ₹913 in Delhi as of March 7. Commercial 19 kg cylinders jumped ₹114.50, with a cumulative rise of over ₹300 in 2026 alone.
That commercial spike doesn’t stay in the kitchen. It flows straight into restaurant menu prices, catering costs, and eventually retail food inflation — the same inflation pressure the RBI flagged when it held rates last month. Every restaurant that stays open will charge more. Every one that closes pushes demand — and prices — onto the survivors.
The government is rationing, refineries are ramping up, and alternative shipping routes around the Cape of Good Hope are being explored. But none of that changes the math today: one chokepoint controls 85% of a supply India literally cannot cook without.
Your next cylinder refill will arrive. It’ll just cost more — and take longer.