Key facts
- Indian Oil Corp. is seeking 50% ownership stakes in very large gas carriers.
- The move aims to reduce exposure to charter-market freight rates.
- India plans to source up to 25% of its LPG imports from the U.S. by 2027.
- The company seeks to lower its U.S. LPG freight costs.
Indian Oil Corp. (IOC) is actively seeking to acquire 50% ownership stakes in very large gas carriers (VLGCs). This initiative is designed to reduce the company's exposure to fluctuating charter market freight rates. The strategic objective behind this move is to support India's ambitious plan to source up to a quarter of its liquefied petroleum gas (LPG) imports from the United States by the year 2027. By investing in vessel ownership, IOC aims to gain greater control over its logistics and potentially stabilize the costs associated with transporting LPG from the U.S. This approach seeks to circumvent the unpredictability and potential cost escalations inherent in chartering vessels on the open market, thereby ensuring a more consistent and cost-effective supply of LPG to meet India's growing energy demands.