Strait of Hormuz Blockade: Why India’s hospitality sector is facing a severe LPG shortage

As the war in West Asia escalates, the Hormuz Strait has been blocked, which has led to a severe shortage of LPG back home in India. About 85-90% of India's LPG passes through this route, the impact of which is now felt by restaurants nationwide. But those whose kitchens are running on cylinders; those with pipeline infrastructure are in a better position as of now. Earlier this week, Union Minister for Petroleum and Natural Gas Hardeep Puri had said, “India is navigating the trilemma of energy availability, affordability and sustainability."

The hospitality sector has been hit, and many fear that if the supply is not restored, it may lead to black market purchases. It was highlighted that “there is no shortage of energy in India and there is no cause for worry for our energy consumers.” But in the last two days, restaurant and hotel associations across the country have been issuing letters.

AHAR, Indian hotel and restaurant association president, Vijay Shetty, said, “We submitted our representation explaining the difficulties faced by restaurants and hospitality establishments due to the non-availability of gas cylinders.”

A delegation of members even met Chhagan Bhujbal, Minister of Food and Civil Supplies, to discuss the ground situation.

While the Chennai Hotel Association said, “The situation has now become even more critical. Commercial LPG distributors have completely stopped supplying cylinders, stating that they have no stock available. As a result, many restaurants are forced to shut down.”

Bengaluru Hotel Association released a notice saying, “The supply of gas cylinders for commercial use has been stopped from today. Since the hotel industry is classified as an Essential Service, the common people, senior citizens, students, medical and other people who depend on it will face difficulties in their daily meals. In addition, our hotel industry will also have to face difficulties until the gas supply returns to normal. Oil companies had said that there would be no disruption in gas supply for 70 days.”

While India’s energy supply remains secure and stable, the sources of crude oil have been diversified from 27 to 40 countries. The government is ensuring multiple alternative supply routes to procure. The country is focused on purchasing oil from wherever the most competitive and affordable prices are available.