The United States has overtaken Gulf nations to become India's largest supplier of both liquefied natural gas and liquefied petroleum gas in May 2026, as Strait of Hormuz disruptions continue to reshape India's energy import mix.

Key Highlights

  • S. LPG share surges to 55%: The U.S. captured 55% of India's LPG import market in May 2026, up from 14% in February.
  • LNG volumes triple:S. LNG exports to India reached 900,000 tonnes in May, accounting for over 40% of India's total requirement.
  • Gulf share collapses: Gulf nations' combined share of India's LPG imports fell from 81% in February to just 16% in May.
  • Eightfold increase from pre-war levels:S. energy exports to India have grown eightfold since the onset of the West Asia conflict.
  • Trade rebalancing in play: Higher U.S. energy imports are seen as the primary lever to reduce India's bilateral trade surplus with Washington, projected to exceed $40 billion in 2026.

U.S. Steps In as India's Energy Lifeline

The United States has emerged as India's largest supplier of both liquefied natural gas (LNG) and liquefied petroleum gas (LPG) in May 2026, marking a sharp realignment in India's energy sourcing strategy following sustained disruptions in the Strait of Hormuz. The shift reflects the cascading impact of the ongoing West Asia conflict on one of the world's most critical energy chokepoints.

India routes approximately 60% of its LNG imports and nearly all of its LPG supply through the Strait of Hormuz. Since the United States and Israel first struck Iran on February 28, 2026, reduced availability of Gulf cargoes has steadily eroded the region's position as India's primary energy supplier, creating a gap that U.S. exporters have moved quickly to fill.

According to data from trade intelligence firm Kpler, U.S. LPG shipments to India reached approximately 666,000 metric tonnes in May, a 73% jump from the prior month. This propelled the U.S. to a 55% share of India's LPG import market, a dramatic rise from 14% in February 2026. Gulf suppliers, which had collectively accounted for 81% of India's LPG imports just three months earlier, saw their combined share decline to 16% in May.

The pivot in LNG flows has been equally pronounced. U.S. LNG exports to India reached 900,000 tonnes in May, representing more than 40% of India's total LNG requirement and a roughly threefold increase from April 2026. The surge reflects India's urgent need to replace disrupted Gulf supply, as well as robust availability of U.S. cargoes in a globally well-supplied LNG market.

India's overall LPG import volumes have contracted sharply from above 2 million tonnes per month in January and February 2026 to around 1.2 million tonnes in May, as domestic refinery output has partially offset the shortfall. LPG serves primarily as a cooking fuel in India, and its supply and pricing carry significant political sensitivity, prompting authorities to prioritise household consumers and essential services.

The energy shift also carries a broader trade dimension. India's bilateral surplus with the United States is on course to surpass $40 billion in 2026, and higher energy purchases from Washington have emerged as the most practical mechanism to rebalance the relationship. State-owned Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation had concluded a structured one-year LPG import contract with U.S. suppliers, including Chevron, Phillips 66, and TotalEnergies, for 2.2 million metric tonnes in 2026. Priced on Mont Belvieu benchmarks, the deal was the first structured contract for U.S. LPG in the Indian market and has positioned American exporters well to capitalise on the ongoing Gulf supply disruption.

While U.S. LNG carries a cost premium over Gulf-sourced supply, India's limited alternatives in the current environment have made American cargoes the default solution as New Delhi works to secure stable energy flows for its fast-growing economy.