Bombay High Court seeks response from the Centre over allegations that LPG exports are being prioritised despite a domestic supply shortage.
The Bombay High Court has issued a notice to the Union Government of India and Confidence Petroleum India Ltd (CPIL) after a petition alleged that LPG exports were being prioritised over domestic supply despite an acute shortage in parts of the country.
The order was passed by the Nagpur bench of the High Court while hearing a petition filed by six Liquefied Petroleum Gas (LPG) dealers, including Omkar Sales, who claimed that the current supply chain disruption has severely affected distributors and consumers in Maharashtra’s Vidarbha region.
Court Calls Issue ‘Serious’
A division bench comprising Justices Anil S Kilor and Raj D Wakode described the matter as a “serious issue” of significant public importance.
While issuing notices to the Centre and CPIL, the bench directed the company to ensure that LPG storage and supply meant for domestic consumption comply with the existing policy framework of the Central government until the matter is finally decided.
The court’s intervention comes amid rising concerns about LPG availability in certain regions of Maharashtra, where distributors claim the shortage has disrupted supply to households and businesses.
Dealers Cite Supply Chain Disruptions
The petition was filed by Omkar Sales along with five other distributors who have long-standing business relationships with CPIL. According to the plea, these dealers procure their entire LPG requirement exclusively from Confidence Petroleum India Ltd.
However, the distributors alleged that the supply chain has become “severely disrupted,” leaving them unable to meet the demand from households, hotels, small industries, and commercial establishments across Nagpur and nearby districts.
The petitioners attributed the disruption partly to ongoing geopolitical tensions involving Iran, the United States, and other Middle Eastern suppliers. They argued that the conflict has impacted the global supply of oil and gas, leading to shortages in the domestic LPG market.
According to the plea, the shortage has caused “widespread hardship” for consumers, particularly in Maharashtra and the Vidarbha region.
Allegation of Export Priority
The dealers further alleged that despite the domestic shortage, CPIL continues to channel a significant portion of its LPG supply to international markets. They claimed that the company is attempting to capitalise on elevated global prices by prioritising exports over domestic distribution.
Such actions, the petitioners argued, are worsening the supply crisis for Indian consumers and violating the government’s policy framework that prioritises domestic availability of essential commodities.
Government Orders Highlighted
In support of their claims, the petitioners referred to two orders issued by the Ministry of Petroleum and Natural Gas (MoPNG) on March 5 and March 9.
These orders were issued under the Essential Commodities Act and the Petroleum Products (Maintenance of Production, Storage and Supply) Order, 1999.
The revised directive issued on March 9 instructs domestic refineries and petrochemical complexes to utilise their entire production streams for LPG generation and make the supply available to the three public sector oil marketing companies.
Additionally, the ministry notified the Natural Gas (Supply Regulation) Order, 2026, which gives priority to sectors such as LPG production and domestic piped natural gas (PNG) supply.
Distributors Warn of Financial Impact
The distributors also informed the court that they had submitted detailed representations to CPIL on March 9, urging the company to reconsider its export strategy and prioritise domestic markets.
They warned that the continuing shortage is not only affecting consumers but also putting financial pressure on distributors, as delayed supplies are leading to payment issues and operational challenges.
CPIL Denies Allegations
Confidence Petroleum India Ltd denied diverting LPG meant for domestic markets. The company stated that it is merely fulfilling contractual obligations related to export deals that were negotiated well in advance.
CPIL argued that altering those agreements at short notice is difficult, particularly given the current volatility in global energy markets.
Matter Awaiting Further Hearing
The High Court will now hear responses from the Centre and CPIL before deciding on further action. The case highlights the delicate balance between international trade commitments and ensuring adequate supply of essential commodities for domestic consumers.
With LPG being a critical household fuel across India, the court’s final decision could have significant implications for both distributors and energy policy in the country.
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