India LPG Shortage Threatens Restaurant Closures Across Multiple States

Vijay Shetty, president of the India Hotels and Restaurant Association, issued a stark warning Sunday night: "All restaurants in Mumbai will be shut in the next two days if this shortage continues." His projection was precise and grim. As of March 9, 10 to 20 percent of IHRA members were already facing operational problems. By the following day, he estimated that figure would reach 60 percent. The day after, 100 percent, forcing full shutdowns.

The trigger is a sudden halt in commercial LPG cylinder dispatches that has spread across Maharashtra, Karnataka, Tamil Nadu, Kerala, Punjab and other states. Oil marketing companies have curtailed or stopped non-domestic LPG supply, redirecting available stock to hospitals and schools. In Punjab, the halt was formalized on March 8, when companies suspended dispatches of 19-kg commercial cylinders and larger industrial packs. Distributors in Punjab have also been instructed to reject refill bookings placed before a mandatory 25-day waiting period.

Maharashtra has been hit especially hard. Processing plants in Nagpur, Pune and Mumbai have seen significant volume reductions. Financial Express reported that as many as 9,000 restaurants and bars across the state could be forced to suspend operations if the situation persists. Pune's gas crematoriums have already been temporarily shut. In Bengaluru, the Bangalore Hotels Association announced on March 9 that many establishments could be forced to stop kitchen operations starting March 10.

For restaurant workers on the ground, the shortage has a price attached to it. Annu Shetty, who operates Hotel Sagar in Mulund, described trying to source cylinders in the open market: "We are not finding commercial LPG cylinders. At a few places it is available but a Rs 1,750 cylinder is being sold for Rs 1,950." The official price of a 19-kg commercial cylinder has already risen by roughly Rs 115 since March 7, while domestic 14.2-kg refills have gone up about Rs 60 in the same period. Domestic customers face delivery delays of two to eight days after booking.

In Kerala, an internal assessment by the Kerala Hotel and Restaurants Association covering all 14 districts found the situation deteriorating rapidly. Bipin Thomas, a state committee member of the association, said that "a large number of hotels and restaurants have already exhausted their LPG stocks, forcing many establishments to ration cooking gas and scale down operations."

The Chennai Hotels Association escalated the matter directly to Prime Minister Narendra Modi in a letter dated March 9. The association cited a central government notification temporarily suspending commercial LPG supply and argued that the food industry's round-the-clock operations directly support hospitals, IT parks, college hostels, train passengers and business travellers. Any prolonged disruption, the letter warned, would ripple well beyond restaurant dining rooms.

Industry sources link the supply disruption to slowing LPG shipments connected to geopolitical tensions in West Asia, including strikes on Iran by the United States and Israel. PTI reported that shipments of liquefied petroleum gas have slowed as a result. Economic Times described the situation as a supply crunch "triggered by the US-Israel war on Iran," though India Today's framing referenced "geopolitical tensions in West Asia" more broadly. The causal chain from international events to Indian supply volumes has not been independently confirmed by oil marketing companies or the central government.

IHRA has written to Union Petroleum Minister Hardeep Singh Puri and has been in contact with Maharashtra Civil Supplies Minister Chhagan Bhujbal. The National Restaurant Association of India has also warned of closures without urgent government intervention. Whether those appeals produce emergency allocations or alternate sourcing before kitchens go dark is the question driving the sector through the coming 48 hours.