New Delhi (Brussels Morning Newspaper) – India announced on Monday that it has agreed to a “significant” deal with the United States, which will provide nearly 10 percent of the country’s liquefied petroleum gas (LPG) imports.
Ties between Washington and New Delhi declined sharply in August after President Donald Trump increased tariffs on India to 50 percent. US officials also accused India of supporting Russia’s war in Ukraine by purchasing its discounted oil, AFP reported.
Both nations are continuing discussions despite disagreements on various issues, such as agricultural trade and Russian oil purchases.
How will the new LPG deal affect India’s energy security?
Indian Minister for Petroleum and Natural Gas, Hardeep Singh Puri, stated that India has agreed to a one-year contract for 2.2 million tonnes of LPG annually, imported from the US Gulf Coast. This supply accounts for nearly 10 percent of India’s yearly LPG imports. Puri said it was
“the first structured contract of US LPG for the Indian market”.
“In our endeavour to provide secure, affordable supplies of LPG to the people of India, we have been diversifying our LPG sourcing,”
Puri said in a statement, adding that
“one of the largest and the world’s fastest growing LPG market opens up to the United States”.
Puri described India as
“one of the largest and the world’s fastest-growing LPG markets,”
noting that the purchase price is benchmarked to Mount Belvieu, a leading global pricing hub. He also shared that teams from IOCL, BPCL, and HPCL had earlier engaged in discussions with American producers before reaching the final agreement.
He also mentioned that the new US import agreement enhances India’s energy security and aligns with the government’s objective of ensuring stable, affordable LPG supplies for households nationwide.
Why is Washington linking India’s Russian oil purchases to tariffs?
Trump imposed tariffs on India because of its purchases of Russian oil. In August 2025, Trump signed an executive order that added a 25% surcharge on “Russian oil” on top of an existing 25% reciprocal tariff on Indian exports.
This raised the total tariff on Indian goods to 50%. This punitive tariff aimed to punish India for indirectly supporting Russia’s military through its oil imports. The U.S. administration sees this as a threat to its national security and foreign policy interests, especially in light of Russia’s war in Ukraine.
How are Indian refiners responding to new US sanctions?
In October, the Indian state-backed refiner HPCL-Mittal Energy announced it had stopped buying Russian crude following sanctions from Washington on Moscow’s two biggest oil firms.
Reliance Industries, the main privately owned Indian importer of Russian crude, has stated it is evaluating the impact of US sanctions along with those introduced by the European Union.
Last month, Reuters also reported that major Indian refiners, including Reliance Industries Ltd., Bharat Petroleum Corp. Ltd., Hindustan Petroleum Corp. Ltd., Mangalore Refinery and Petrochemicals Ltd., and HPCL-Mittal Energy Ltd., which together made up about two-thirds of India’s Russian oil imports, have reportedly stopped or paused their December orders for Russian crude.
