Public sector oil marketing companies have signed a one-year deal to import cooking gas from the United States in 2026, as part of India’s effort to narrow trade deficit between the countries.

“Indian PSU oil companies have successfully concluded a one-year structured contract to import around 2.2 million tonnes of LPG from the US Gulf Coast for the contract year 2026,” an official statement said on Monday.

The quantity contracted is close to 10 per cent of India’s annual LPG imports and marks the first such structured US LPG contract for the Indian market.

India has enough refining capacity to produce petrol, diesel and aviation turbine fuel, even as it imports 85 per cent of the feedstock, the crude oil.

However, the country imports about 65 per cent of its LPG consumption of 31 million tonnes (mt). In 2024, about 90 per cent of the 20.4 mt of LPG imports came from West Asian countries like the UAE, Qatar, Kuwait and Saudi Arabia.

Even as India imported cargoes from the US sporadically, this is the first time the country has entered into a structured contract.

PSUs such as Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL) will import about 48 very-large gas carriers of LPG in 2026. The supplies will be made by petroleum majors such as Chevron, Phillips and TotalEnergies Trading SA.

India has earlier indicated it will double its energy purchase from the US, realising the trade surplus in favour of India is a major sticking point for President Donald Trump. A senior government official, however, on Monday insisted the LPG purchase is not part of the trade deal talks.

“It was something that was in the works for a long time. This is in the overall context of keeping the trade with the US. It is not part of any negotiations package per se, but definitely as part of our endeavour to balance trade with the US,” the official said.

The announcement of the LPG deal was made by oil minister Hardeep Singh Puri, who posted on X: “A historic first! One of the largest and the world’s fastest growing LPG markets opens up to the US,” he said.