Ministry of Petroleum Mandates LPG Buffer Stocks
To insulate the domestic market from international supply volatility and prevent local cooking gas shortages, the Ministry of Petroleum and Natural Gas has mandated that all public sector Oil Marketing Companies (OMCs) maintain a minimum 30-day buffer reserve of Liquefied Petroleum Gas (LPG). The rule applies to key state-run entities, including Indian Oil Corporation (IOCL), Bharat Petroleum (BPCL), and Hindustan Petroleum (HPCL).
Previously, OMCs maintained varying reserves, often averaging 10 to 14 days, depending on localized bottling plant capacities. The directive requires these corporations to invest in expanding bulk storage terminals and pipeline capacities to accommodate the larger buffer. This move is designed to ensure supply stability during monsoon seasons or geopolitical disruptions in the Middle East.
OMCs Tasked with Bulk Storage Infrastructure Expansion
Industry analysts estimate that the mandated expansion will require significant capital expenditures from OMCs, who must set up automated safety terminals and strategic reserves near key distribution hubs. However, the government has emphasized that long-term supply security takes precedence over short-term infrastructure costs. OMCs have been given a timeline to implement the mandatory reserve levels across major Indian states.
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