India restaurants warn of shutdowns over gas scarcity

The hospitality sector in India is facing a severe crisis as the escalating conflict involving Iran disrupts the supply of liquefied petroleum gas. Restaurants and hotels across the nation warned on Tuesday of potential shutdowns due to dwindling fuel stocks, a situation that has prompted the government to establish a review panel to address industry concerns. The shortage stems from the ongoing conflict involving the United States and Israel against Iranian forces, which has effectively paralyzed maritime traffic in the Gulf and the Strait of Hormuz. This regional instability has significantly impacted energy markets, driving up prices and transport costs while hindering exports from major producers such as Qatar and Saudi Arabia. As the world's second-largest importer of LPG, the Indian government recently invoked emergency powers to mandate that refiners prioritize domestic production. This shift has left the commercial sector, including suppliers like Dorian LPG Ltd., struggling to maintain consistent deliveries for the hospitality industry. Business owners are already feeling the strain of the supply chain breakdown. Bert Mueller, the founder of the Mexican food chain California Burrito, noted that his company is currently operating on a very thin margin of fuel. > "We have LPG stock for two days." Mueller added that the chain, which operates over 100 locations from Bengaluru to Delhi, is attempting to conserve gas and transition some stores to induction stoves. Meanwhile, the National Restaurant Association of India (NRAI), representing over half a million establishments, has formally appealed to the government for assistance. > "Any disruption therein will lead to a catastrophic closure." In Bengaluru, often referred to as the Silicon Valley of the country, the situation is particularly dire. Many kitchen operations are reportedly nearing a standstill as deliveries of gas cylinders have plummeted. Local operators, such as Manish V. Shetty of the Udupi Food Hub chain, have had to rely on long-standing vendor relationships and immediate cash payments to secure limited supplies. Beyond gas, the industry is also grappling with rising costs for other essentials, including sunflower oil. Safety regulations prevent most restaurants from stockpiling large quantities of LPG, making them highly dependent on frequent deliveries. Industry representatives indicate that even those with some reserves could run out of fuel within one to two weeks if the supply chain is not restored. The Indian oil ministry's newly formed panel is currently reviewing requests for LPG allocations to prevent a widespread collapse of the restaurant sector.