India signs first US LPG import deal:PSUs secure 2.2 mn tonnes; think-tank says this confirms sanctions on Russian oil serve shale interests more than Ukraine

In a significant development, India’s state-owned oil marketing companies have finalised a one-year agreement to import liquefied petroleum gas (LPG) from the US Gulf Coast. The deal, covering the contract year 2026, marks the first structured US-LPG supply arrangement for the Indian market and is expected to account for nearly 10% of the country’s annual LPG imports. Union Minister Hardeep Singh Puri described the development as a “historic first,” noting that one of the world’s fastest-growing LPG markets has now formally opened to the United States for long-term structured supplies. Government Push for Supply Security Announcing the agreement in an X post, Puri said the government has been actively diversifying LPG sourcing in order to ensure secure and affordable supplies for households across India. The newly concluded deal will see IndianOil, BPCL and HPCL collectively import 2.2 million tonnes per annum (MTPA) of LPG from the US Gulf Coast. The pricing for the contract will be benchmarked to Mount Belvieu, the US industry standard for LPG. According to Puri, teams from the three public-sector companies had travelled to the United States and engaged in extensive negotiations with major US suppliers in recent months, ultimately leading to the successful closure of the agreement. Russian Oil Sanctions Served to Protect the US Shale Oil Sector According to the Global Trade Research Initiative (GTRI), Washington’s sanctions on Rosneft and Lukoil—companies responsible for nearly 57% of Russia’s crude output—effectively cut off one of the world’s largest oil flows. GTRI notes that the sanctions, implemented on October 22, triggered an immediate reaction in global markets. Crude oil prices rose 7.5% within a week, climbing from $61 to USD $65.6 per barrel, with expectations of further increases as supplies tightened. While the sanctions were officially framed as a step toward promoting peace in Ukraine, GTRI argues that the measures also served to protect the United States’ own shale oil sector, which has long struggled during periods of low crude prices. US Sanctions Differ from UN-mandated Measures According to the GTRI analysis, US sanctions differ from United Nations-mandated measures because they not only target specific entities but also penalise any company or country that conducts business with them. Violations can lead to being placed on the Specially Designated Nationals (SDN) List, enforced by the US Office of Foreign Assets Control (OFAC), effectively cutting off access to the SWIFT global payments network. Such restrictions extend to shipping, insurance and technology systems, compelling global firms to cease engagement with sanctioned entities immediately. Shale Oil Economics The GTRI report further observes that the sanctions inadvertently boosted profitability for the US shale industry, which typically becomes economically viable when crude prices exceed $60-70 per barrel. By constraining global supply, the sanctions pushed prices upward, enabling American shale producers to stabilise operations and expand exports. As a result, US energy companies recorded strong profits, and American exports of crude oil and LNG reached historic highs. Finally, While geopolitical dynamics continue to influence supply chains and pricing, the deal underscores India’s efforts to secure long-term, reliable access to essential fuels. As global energy markets evolve amid ongoing geopolitical tensions, India’s latest procurement move positions it to better manage supply risks while expanding its network of strategic energy partnerships. ​