Indian restaurants warn of shutdowns as Iran war makes cooking gas scarce

The country has invoked emergency powers to boost domestic LPG production

An employee checks empty LPG cylinders inside Vidyarthi Bhavan restaurant, as restaurants and hotels in southern India, including the IT hub of Bengaluru, have warned of shutdowns amid disruptions in commercial LPG supply, following the US-Israeli conflict with Iran, in Bengaluru, India, Mar 10, 2026. REUTERS/Priyanshu Singh

Restaurants and hotels across India warned of disruptions and possible shutdowns on Tuesday, as the Iran war constricts supplies of cooking gas, prompting authorities to set up a panel to review industry requests.

The fuel shortage comes as the US-Israel war on Iran has halted ship traffic in the Gulf and the Strait of Hormuz, driving up energy prices and transport costs, hitting exports and output from Gulf producers, such as Qatar and Saudi Arabia.

India, the world's second-biggest importer of liquefied petroleum gas (LPG), invoked emergency powers last week to order refiners to crank up production for domestic use, leaving the hospitality industry struggling to get sufficient supply.

"We have LPG stock for two days. We are working on contingencies," said Bert Mueller, founder of Mexican food chain California Burrito, with more than 100 stores spanning Bengaluru and Chennai in India's south to Delhi and Noida in the north.

"We are conserving gas and installing induction stoves at certain stores."

India's oil ministry said it had set up a panel to review requests for LPG supply to restaurants and other industries, following appeals from two industry bodies.

"The restaurant industry is predominantly dependent on commercial LPG for its operations," the National Restaurant Association of India, which represents more than half a million restaurants, told the food processing ministry on Monday.

"Any disruption therein will lead to a catastrophic closure," the NRAI said in a letter, while another body, the Federation of Hotel & Restaurant Associations of India, also sought government help.

Indian companies have raised LPG prices for the first time in about a year, as the war boosts prices of the imports that fill two-thirds of annual LPG consumption.

India's largest supplier of LNG, Qatar, halted production last week after Iran's strikes on Gulf countries in retaliation for Israeli and US strikes against it.

DWINDLING SUPPLIES

In the southern tech hub of Bengaluru dubbed India's Silicon Valley, several restaurants said deliveries had dropped sharply, fanning that kitchens will come to a halt if the situation is not resolved.

"One of our restaurants did not receive gas cylinders today," Manish V Shetty, who runs the Udupi Food Hub chain of restaurants in Bengaluru told Reuters.

"Thankfully, one of our older vendors helped us," he added, because the chain offers immediate payment, rather than credit terms of a week or month. "We're also seeing a spike in the price of the sunflower oil that we use for cooking."

Few restaurants stockpile LPG cylinders, because of safety concerns, relying instead on frequent replacement, said Veerendra Kamat, secretary of the Bengaluru Hotels Association.

"It's a very grave situation. Most of the (gas) companies have stopped supplying," said Ananth Narayan of the NRAI's Bengaluru branch, adding that even those restaurants that do store gas could run out within a week or two.