Indian Oil Eyes Stakes In Gas Carriers To Cut U.S. LPG Freight Costs

Indian Oil Corp. is seeking 50% ownership stakes in very large gas carriers, a first for an Indian refiner, as the company prepares to transport higher volumes of U.S. liquefied petroleum gas under India’s plan to source up to one-quarter of its LPG imports from the United States in 2027 and reduce its exposure to charter-market freight rates, the Business Standard reported on Wednesday.Indian Oil is accepting bids for ships with carrying capacity between 80,000 and 93,500 cubic meters. Eligible vessels must be no more than 12 years old. Bidders may submit as many as two ships, and IndianOil LNG may acquire one or more vessels through the tender, according to The Economic Times.The company scheduled a pre-bid meeting for August 5 and set a September 7 deadline for commercial and technical bids. Acquired vessels will be registered under the Indian flag.Set OilPrice.com as a preferred source in Google here.Freight represents the largest obstacle to expanding U.S. LPG purchases. Cargoes from the U.S. Gulf Coast travel far farther than supplies from Saudi Arabia, the United Arab Emirates and Qatar, raising delivered costs even when American propane and butane prices remain competitive.India bought about 90% of its 21.85 million metric tons of LPG imports from the Middle East in 2025. Imports supplied 66% of domestic consumption, leaving household cooking-gas availability exposed to tanker disruptions through the Strait of Hormuz.The Iran war and the closure of Hormuz produced India’s worst LPG shortage earlier this year. The supply disruption also exposed freight as India’s primary constraint. Even when U.S. LPG is competitively priced, the longer voyage from the U.S. Gulf Coast leaves delivered costs highly sensitive to VLGC charter rates. That means vessel ownership is a strategic advantage now, not simply a logistics decision.Indian Oil, Bharat Petroleum and Hindustan Petroleum are preparing tenders for U.S. supplies beginning in 2027. India expects LPG imports to reach about 20 million metric tons next year as national consumption returns to roughly 31 million tons.U.S. energy purchases also form part of India’s commitment to expand American imports by $10 billion and increase bilateral trade to $500 billion by 2030. Partial vessel ownership gives Indian Oil direct control over part of the freight bill attached to that shift.By Charles Kennedy for Oilprice.comMore Top Reads From Oilprice.comSaudi Crude Tanker Goes Dark to Slip Through Bab el-MandebHouthis Claim Attack on Saudi Oil Tanker in Red SeaOil Jumps 7% As Trump Threatens Iran Hours Before Fed Decision