As Middle East tensions disrupt gas supplies to India, causing LPG shortages and price hikes, the government's Natural Gas Regulation Order, 2026, prioritizes allocations for essential sectors like fertilizers at 70% of average consumption. This has sparked a surge in fertilizer stocks, with gains up to 17%.
Disruptions from the Middle East conflict, including risks to key routes like the Strait of Hormuz, have led to gas shortages in Indian cities and sharp rises in domestic and commercial LPG prices. Industries such as fertilizers, restaurants, and manufacturing face intensified constraints.
The Indian government's Natural Gas Regulation Order, 2026, responds by prioritizing gas for critical sectors. Fertilizer plants will receive 70% of their average consumption to maintain ammonia and urea production amid uncertain LNG supplies.
Markets reacted bullishly: Rashtriya Chemicals and Fertilizers (RCF) and Fertilisers and Chemicals Travancore (FACT) jumped up to 17%, while Coromandel International, Chambal Fertilisers & Chemicals, Deepak Fertilisers & Petrochemicals, and Paradeep Phosphates also posted strong gains. The order is seen as securing fertilizer output, vital for agriculture.
This intervention underscores India's exposure to global energy shocks, with further measures possible as the crisis evolves.
