India has signed its first structured and long-term agreement to import liquefied petroleum gas from the United States, and the government said this step would make the country’s energy supply safer and more stable at a time when global markets are becoming more uncertain.

Union Petroleum and Natural Gas Minister Hardeep Singh Puri said on Monday that state run oil companies had completed a one year deal to bring in nearly 2.2 million tonnes per annum of LPG from the US Gulf Coast for the contract year 2026, and this amount is close to 10 percent of India’s yearly LPG imports which shows a clear shift in the way India is planning its supply.

The contract is India’s first structured LPG purchase from the United States and is linked to the Mont Belvieu pricing point, which guides LPG rates in the US, and officials from Indian Oil Corporation, Bharat Petroleum Corporation Ltd and Hindustan Petroleum Corporation Ltd had travelled to the US over the past few months to negotiate with major American producers.

“This is a historic first,” Puri said, explaining that one of the fastest-growing LPG markets in the world is now formally opening up to American supplies. “In our endeavour to provide secure and affordable LPG to the people of India, we have been diversifying our sourcing. This deal marks a significant step in that direction.”

India is the second-largest LPG consumer in the world, and demand has increased because more families are shifting to LPG and because the Ujjwala Yojana has continued to grow by giving subsidised LPG connections to low-income households. India currently brings in more than half of its LPG from other countries, with most of the supply coming from West Asia.

The decision to buy a meaningful share from the United States is part of New Delhi’s long-term plan to reduce reliance on traditional sources, make supply steadier and protect Indian consumers from sudden jumps in global prices.

Puri said that even when global LPG prices rose by more than 60 per cent last year, the government ensured that Ujjwala beneficiaries paid only Rs 500 to Rs 550 for each cylinder while the actual cost was close to Rs 1,100, and he said the state covered the rest and spent over Rs 40,000 crore to shield households from the price rise.

The minister said the US deal is another important step towards ensuring “secure, affordable, and reliable LPG supplies” for people across India.

The agreement is also expected to strengthen India’s energy ties with the United States and may help both countries move towards longer-term supply arrangements. For Indian oil marketing companies, this diversification away from a single region lowers supply risks and brings more predictable pricing.

With LPG use rising fast in many rural parts of the country, the government said that finding more varied and stable supply sources will remain one of its top goals.