Indian Oil Corp, the country's largest fuel retailer, said Tuesday that it is incurring a revenue loss of 617 rupees on every 14.2-kilogram liquefied petroleum gas cylinder sold, a steep increase from a 171-rupee loss reported in April. The company's finance chief, Anuj Jain, provided the figures during a briefing with analysts.
Jain noted that the average revenue loss per cylinder was 100 rupees in the January-March quarter. He reiterated that state-run fuel retailers sell household LPG at subsidized prices, a practice that has contributed to the recorded losses amid rising procurement costs.
India's LPG consumption reached 33.15 million tons in 2025, with imports making up roughly 60% of that demand. Of the imported volumes, about 90% historically originate from the Middle East. Jain said supplies from the region have been disrupted due to the closure of the Strait of Hormuz following the U.S.-Israeli war with Iran, forcing Indian Oil to alter its sourcing strategy.
As a result of the disruption, Indian Oil has broadened its buying destinations for crude, LPG and liquefied natural gas. The company has recently acquired LNG cargoes from Oman, Nigeria, Angola and Indonesia after several major Middle Eastern suppliers declared force majeure, Jain told analysts.
"Our priority is to ensure the energy security. Because of this disruption, we have diversified our crude sourcing and LPG sourcing. We have changed our refinery diet," Jain said.
Jain added that the company is operating its refineries at full capacity and currently holds about one month's worth of crude inventory. To boost domestic processing capability, Indian Oil plans to increase capacity at several refineries before the end of the year: Panipat to 500,000 barrels per day, its Gujarat refinery to 360,000 barrels per day, and the Barauni plant to 180,000 barrels per day.
Contextual note - The company attributes rapidly rising procurement costs to disruptions in Middle Eastern supply routes and subsequent force majeure declarations among major regional suppliers. Management actions include sourcing diversification, maximizing refinery throughput, and planned refinery capacity expansions.
This report is based on statements made by Indian Oil's finance chief during an analyst briefing and on the consumption and import figures cited by the company.