LPG Market Size (2025-2030)

The LPG Market was valued at USD 115.3 billion in 2024 and is projected to reach a market size of USD 153.6 billion by the end of 2030. Over the forecast period of 2025-2030, the market is projected to grow at a CAGR of 5.90%.         

The Liquefied Petroleum Gas (LPG) market is seeing rapid worldwide development due to the increasing requirement for clean, efficient, and economical energy sources. Due to the process of urbanization, government support, and changes in the population away from traditional fuels, the preference toward LPG has risen for residential cooking, transport, and industrial applications. With less emission of CO2, easy storage ability, and versatile nature, LPG adopts the role of a key transition fuel on the route to sustainable energy. LPG represents an important player in the changing energy arena as developed and emerging economies move towards cleaner alternatives.

Key Market Insights:

Over 3 billion people use LPG for cooking and heating. In India alone, household LPG penetration has reached nearly 99%, boosted by government subsidy schemes like PMUY.

The Asia-Pacific region accounts for over 40% of global LPG consumption. Growth is fueled by rising urban populations and cleaner energy policies in countries like China and India.

LPG emits about 33% less CO₂ than gasoline and over 50% less than coal. This makes it a compelling option for countries targeting carbon neutrality and energy transition.

LPG Market Drivers:

One of the strongest drivers for the global LPG market is the continued push by governments, especially in developing nations, to promote clean cooking fuel.

One of the biggest driving forces for the LPG market all over the world is the continuous push by the government, especially in developing nations, for promoting clean cooking fuels, as in India. The Pradhan Mantri Ujjwala Yojana (PMUY) scheme, for instance, has connected over 90 million underprivileged households living in rural India to LPG since the year 2016. It helps move the household from depending on unhealthy traditional biomass fuels such as firewood and cow dung, which are harmful to health and the environment. The governments also give DBT subsidies to make LPG affordable to economically weaker sections. Such initiatives result not merely in improved health conditions for women, who are mainly responsible for cooking, but also in empowerment for women in these regions. Similar schemes are being rolled out across continents, in Africa, Southeast Asia, and Latin America. The World Health Organization (WHO) lists household air pollution from solid fuels as one of the major risk factors to health, further driving the urgency to adopt LPG. In addition to this, international funding bodies put forward infrastructure development on LPG accessibility. Policy comes on board in making LPG household demand a fundamental pillar. It has broadened the global customer base and made LPG a significant tool for energy equity and environmental advancement.

LPG is increasingly recognized as a transitional fuel in the global shift toward cleaner energy, offering a reliable and lower-emission alternative to coal, kerosene, and diesel.

LPG, the increasingly recognized transitory fuel in the emerging energy transition towards cleaner fuels, provides an efficient alternative with lower emissions than coal, kerosene, and diesel to be relied on. A summary of its emissions shows that it produces fewer greenhouse gas emissions, making it favorable among countries aspiring for net-zero emissions. LPG does not require pipelines, as natural gas does, making it ideal for off-grid and remote sites such as islands and hilly terrains. Its versatility cuts across sectors- from household cooking to automotive fuel, through industrial heating, and to agriculture, where it is used for crop drying and water pumping. The rising demand for LPG as a convenient and portable energy source stems from rapid urbanization in developing economies, coupled with the growing middle-class population. At the same time, consumers and industries alike are getting more and more conscious about the environment and trying to adopt cleaner fuels. Industries are also facing increased pressure to comply with carbon restrictions and, thus, are compelled to switch to LPG instead of more polluting fuels. With an increase in infrastructure investments and private sector participation, LPG is well-positioned as a multi-purpose energy solution for the future.

LPG Market Restraints and Challenges:

One of the major challenges facing the LPG market is the volatility in global LPG prices, driven by fluctuations in crude oil and natural gas prices.

One of the issues that greatly affects the LPG market is the volatility of global LPG prices, which are driven by fluctuations in crude oil and natural gas prices. Since LPG is a byproduct in the processes of oil refining and natural gas processing, its pricing is closely correlated with the pricing on the international energy market and is therefore vulnerable to concerns arising from geopolitical tensions, OPEC's decisions, and supply-demand imbalance. Therefore, in a sense, economic uncertainty prevails for importing countries and increased subsidy burdens on the governments. Further, inconsistent supply and distribution due to infrastructural and logistical challenges in far-off or underdeveloped regions aggravate the situation. Poor transport networks, low storage capacities, and costly cylinder replacements may also render LPG less available and more expensive to the final consumers. Supply chains run under severe stress during global crises like the COVID-19 pandemic and other geopolitical conflicts, causing unintended delays in delivery and sharp price increases. Undoubtedly, these challenges are dampening consumer uptake and preventing the commercial and industrial sectors from switching to LPG in full measure. One way to tackle this problem would be to invest in local bottling plants as well as strong distribution sectors and to improve the setup of regulatory frameworks for price stability of supply.

LPG Market Opportunities:

The LPG market is promising in terms of growth potential, especially in emerging areas of Asia, Africa, and Latin America, where access to clean energy is limited. Millions of households located in rural and semi-urban areas still rely on solid fuels, thereby offering a huge untapped market for LPG providers. Opportunities for huge growth emanate additionally from government-initiated programs of electrification and clean cooking projects. The possibility of bio-LPG (renewable LPG) that is produced from organic waste and biomass is another sustainable alternative that fits perfectly within the greater goals of reducing carbon emissions around the globe. Increasing environmental regulations have made industries and the transport sector interested in cleaner alternatives, thus creating new segments for auto-LPG and industrial LPG applications. Improvements in efficiency and reach to consumers are being driven through technological advances, namely smart metering, lightweight composite cylinders, and digital distribution platforms. It is favourable for the cost aspects of being adopted in this way, with strategic alliances among governments, NGOs, and private companies. Increasingly, people are going to understand the health and environmental benefits of LPG, which will stretch its reach as a transitional fuel and economic as well as ecological feature with the redefined energy landscape worldwide.

LPG MARKET REPORT COVERAGE:

LPG Market Segmentation:

LPG Market Segmentation: By Source

• Refinery
• Associated Gas
• Non-Associated Gas

The LPG sourced from refineries is a byproduct of the crude oil refining processes and is regarded as a major source in many countries. Associated gas, which is produced when crude oil is being extracted, is another source for the supply of LPG, especially in oil-rich basins such as the Middle East and Russia. Increased crude oil production implies that there are increased associated gas recoveries. The non-associated sources, such as those produced directly from natural gas fields, are gaining in prominence as the technologies for exploration and extraction of natural gas improve. This enables enhanced guarantees of a more stable and dedicated supply of LPG while helping meet the increasing demand in industry and households. As the world is gradually moving toward cleaner fuels and gas-based economies, the spotlight will probably shift toward non-associated gas in its supply of LPG to the markets, considering that non-associated gas is of good quality and scalable.

LPG Market Segmentation: By End-User

• Households
• Restaurants & Hotels
• Manufacturing Industries
• Agricultural Farms
• Automobile Users
• Chemical Plants

Household consumption is the most significant end-product, whereby LPG is primarily used for cooking and heating purposes. The demand for LPG is especially high in the Asia-Pacific region and Africa, where clean cooking initiatives are running. In restaurants and hotels, there is a need for uninterrupted and high-calorific heating fuel, and LPG is perfectly suited for commercial kitchens and hospitality. In the manufacturing industry, LPG is known to be used for metal cutting, glass making, and ceramics, among other things, giving it credit for its efficiency and cleaner emissions than coal and diesel. Agricultural farms use LPG for crop drying, pest control, and greenhouse heating, especially in areas where electricity is not readily available. Auto-LPG, in the automotive sector, presents prospects as a low-emission and economic fuel, particularly in countries that embrace alternative fuel incentives. The chemical industry consumes LPG as a key feedstock for propylene and butylene production, making it a crucial component for the petrochemical industry.

LPG Market Segmentation: Regional Analysis:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East & Africa

The demand for LPG around the world shows strong regional variation, with Asia-Pacific leading due to comparatively higher residential demands in countries such as India and China. The key factors for growth in this region include urbanization, government-supported subsidy programs, and increased incentives for clean cooking. The North American region is closely following due to the strong production of LPG, particularly in the US, and for industrial and petrochemical applications. Consumption patterns in the European region continue to be steady, sustained by the adoption of Auto-LPG usage, demanding clean energy policies, and residential heating needs. In Africa and the Middle East, the market is supported by natural gas resource availability, rising domestic consumption, and infrastructure developments. Brazil is leading in South America, which is experiencing growth for LPG in both residential use and agricultural applications. Each region's unique mix of demand drivers further illustrates the flexible attributes of LPG in the world's energy access and sustainability efforts.

COVID-19 Impact Analysis on the LPG Market:

The COVID-19 pandemic had a hybrid impact on the international LPG market, affecting supply chains while at the same time altering patterns of consumption. On the supply side, lockdowns and restrictions interfered with refinery operations and logistical bottlenecks, leading to regional supply shortages in some areas for periods. Import-dependent countries also had to deal with port closures and shipping delays, making them practically unable to secure consistent LPG deliveries. On the other hand, residential LPG consumption went quite high, as people spent most of their time at home, thus using gas more for cooking and heating. This, however, had been accompanied by declining demand from commercial and industrial sectors, whereby hospitality, manufacturing, and transport were severely affected by shutdowns and curtailment of activities. With restrictions on human movement, auto-LPG consumption fell sharply. In many countries, governments increased LPG subsidies and maintained unhindered distribution of cylinders to assist households during the crisis.

Latest Trends/ Developments:

The LPG market is currently experiencing changes due to trade realignments, infrastructure development, and green innovation. The geopolitical change where LPG is exported from Russia to India is a matter now, whereas the U.S. LPG was diverted from China to other Asian and European markets to reshape supply chains globally. Infrastructure investments to support distribution and storage are on the rise, with Asia expanding while India seeks to finish its national 1,300 km LPG pipeline by 2025 for better efficiency. Innovations such as IoT-enabled smart cylinders, automated refill stations, and AI-driven logistics enhance safety, tracking, and supply reliability. Bio-LPG is also slowly becoming popular as a renewable, low-carbon alternative in line with the broader sustainability goals. There is now a growing demand for LPG as a petrochemical feedstock and autogas in cleaner fuel initiatives and industrial expansion. These processes signify a broad change toward smart, green, and resilient LPG markets globally.

  Key Players:

1. BP p.l.c.
2. Shell plc
3. Chevron Corporation
4. ExxonMobil Corporation
5. TotalEnergies SE
6. China Petroleum & Chemical Corporation
7. PetroChina Company Limited
8. Reliance Industries Limited
9. Saudi Aramco
10. Indian Oil Corporation Ltd.
11. Repsol S.A.
12. Equinor ASA
13. SHV Energy
14. ConocoPhillips