Summary

A liquefied petroleum gas (LPG) tanker—Sarv Shakti—broadcasting India as its destination is on the move to cross the critical maritime chokepoint of the Strait of Hormuz, according to ship tracking data. If the LPG carrier successfully crosses the Strait of Hormuz, it would be the first major India-bound energy tanker to do so after a two-week dry spell. Crude oil tanker Desh Garima had crossed the Strait on April 18 after Iran had announced free passage through the Strait, only to announce its closure again shortly after. Two Indian vessels had also come under Iranian fire on the same day, forcing them and other India-bound vessels to return to the Persian Gulf. This incident, and subsequent similar ones with Iran and the US running their own blockades in the region, further hit already constrained vessel movements through the Strait. As per vessel tracking data, the Marshall Islands-flagged Sarv Shakti, estimated to be carrying about 45,000 tonnes of LPG, was on the verge of transiting to the east of the Strait into the Gulf of Oman as of 2 pm India time. Earlier during the day, it had stopped transmitting its location for a couple of years. This is referred to as “going dark” in shipping parlance, and is usually done by vessels in a bid to avoid detection. While the tanker itself is carrying half a day’s worth of India’s pre-West Asia war LPG consumption, its transit springs hope for more energy supplies making their way to India in the coming days. So far, 10 India-flagged energy tankers—nine LPG carriers and one crude oil tanker—have crossed the Strait of Hormuz since early March. Additionally, a few foreign-flagged energy tankers had also arrived from the Persian Gulf after crossing the Strait. These transits took place every few days, but were badly hit after the April 18 incident in which Indian vessels were fired upon by Iranian forces. There are now 14 Indian ships stuck in the Persian Gulf; several other foreign vessels that are bound for India are also stuck in the region. Tanker took Iran-prescribed route out of Hormuz Data from ship tracking and maritime intelligence firm MarineTraffic shows that Sarv Shakti sailed close to Iran’s Larak island, taking a route that has been prescribed by Tehran for transiting the chokepoint, where vessel movements have reduced to a trickle amid the west Asia war. The Strait of Hormuz is a narrow waterway between Iran and Oman that connects the Persian Gulf with the Gulf of Oman and the Arabian Sea and is a major chokepoint for global energy flows. Around one-fifth of global oil and gas flows transited the Strait before the war began. The LPG tanker was broadcasting that it was headed to India and had Indian crew on board. Such identity broadcasts have become a standard of sorts among vessels crossing the Strait in coordination with Iranian authorities, which are regulating vessel movements. The tanker is estimated to have entered the Persian Gulf in February, where it had been stranded since the beginning of the West Asia war on February 28. Global shipping databases list Dubai-based Foresight Group Services as the tanker’s commercial manager. LPG tanker transits a priority for India The effective closure of the Strait of Hormuz has hit energy supplies to India, which depends on imports to meet a bulk of its energy needs. Around 40% of India’s crude oil imports, over 50% of its LNG imports, and a whopping 90% of its LPG imports came from West Asia through the Strait, making the chokepoint particularly critical for India’s LPG supplies. That’s primarily the reason why India has prioritised the movement of its LPG tankers over its other vessels through the Strait. Newsletter Follow our daily newsletter so you never miss anything important. On Wednesday, we answer readers' questions. India’s annual LPG consumption stands at a little over 33 million tonnes, or about 90,000 tonnes a day, with an import dependency level of 60%. But with the disruption in flows through the Strait of Hormuz, India’s LPG consumption has declined to about 80,000 tonnes a day. With 90% of India’s LPG imports coming from West Asia, the Strait of Hormuz effectively sees the movement of around 54% of India’s LPG consumption. The LPG supply constraint has forced the government to cut supplies to commercial and industrial consumers in an effort to ensure uninterrupted supplies to crores of households that use the fuel for cooking. Additionally, the government ordered refiners to maximise LPG production, and directed them to divert propane, butane, and other streams from petrochemical manufacturing to LPG production. These measures have led to an increase of 40% in domestic LPG production vis-à-vis pre-West Asia conflict levels, which means that India’s own LPG production is now meeting roughly 55% of the country’s demand versus 40% earlier. Sukalp Sharma is a Deputy Associate Editor with The Indian Express and writes on a host of subjects and sectors, notably energy and aviation. He has over 16 years of experience in journalism with a body of work spanning areas like politics, development, equity markets, corporates, trade, and economic policy. He considers himself an above-average photographer, which goes well with his love for travel. ... Read More