Mumbai LPG Gas Shortage: Hotels Hit by Black Marketing as Cylinders Sold for Rs 3000, Says AHRA President Vijay Shetty

The hospitality sector in Mumbai is facing a growing crisis as commercial LPG shortages begin to severely disrupt hotel and restaurant operations across the city. Industry representatives warn that several establishments have already been forced to shut down, while many others are struggling to keep their kitchens operational due to the lack of cooking fuel. The disruption, believed to be linked to supply chain disturbances triggered by the ongoing Iran–Israel conflict in West Asia, is creating uncertainty for businesses that rely entirely on LPG cylinders. Hoteliers say the situation has become more alarming as reports of cylinders being sold at inflated prices through black marketing have started to surface.

Highlighting the situation, Indian Hotel & Restaurant Association (AHRA) President Vijay K. Shetty said, "An average-sized hotel consumes about three to four cylinders. And just today we found out that these cylinders are being sold on the black market. A cylinder worth Rs 1840 is being sold for Rs 3000. This is not feasible, and shutting down the hotel is a better option than running it after buying a cylinder at this cost." Industry representatives say the inflated prices are pushing many eateries to the brink of closure as purchasing fuel at such rates would significantly increase operational costs and make it difficult to keep food affordable for customers.

Mumbai, Maharashtra: Indian Hotel & Restaurant Association (AHRA), President, Vijay K. Shetty says, "An average-sized hotel consumes about three to four cylinders. And just today we found out that these cylinders are being sold on the black market..." pic.twitter.com/o1gL54eI94

— IANS (@ians_india) March 10, 2026

The shortage has already begun affecting the city’s hospitality landscape, with several establishments temporarily shutting down due to lack of cooking fuel. Vijay K. Shetty said, "Already, 20% of our hotels have closed due to the short supply of LPG cylinders, and this trend is likely to continue. It is expected that at least 50–60 more hotels may shut down in the next 2–3 days." According to industry bodies, the crisis is escalating quickly as restaurants that rely entirely on commercial LPG cylinders are unable to function without steady deliveries, raising concerns about a larger shutdown across the sector.

Mumbai, Maharashtra: Indian Hotel & Restaurant Association (AHRA), President, Vijay K. Shetty says, "You are absolutely right. Already, 20% of our hotels have closed due to the short supply of LPG cylinders, and this trend is likely to continue. It is expected that at least 50–60… pic.twitter.com/VjvOMIOYTf

— IANS (@ians_india) March 10, 2026

Hotel owners say the situation on the ground is becoming increasingly difficult as gas supplies continue to remain uncertain. Kamalakar Shenoy, a hotel owner in Mumbai, said the shortage has pushed many businesses to the edge of closure. “This is absolutely true because our hotel will now be able to run only for another two to four hours, and we do not know what will happen after that,” he said. Shenoy further claimed that while suppliers maintain that gas availability remains normal, hoteliers are experiencing the opposite, suggesting that unofficial instructions may have been given to present the situation as stable despite the shortages.

Mumbai, Maharashtra: On fuel and gas supply disruptions amid the West Asia conflict, Hotel owner Kamalakar Shenoy says, "This is absolutely true because our hotel will now be able to run only for another 2–4 hours, and we don’t know what will happen after that. There is a lot of… https://t.co/ePqabiauw6">pic.twitter.com/ePqabiauw6

— IANS (@ians_india) https://twitter.com/ians_india/status/2031257807492887021?ref_src=twsrc…">March 10, 2026

Also Read: Narendra Modi Govt Issues Order To Regulate Natural Gas Supply Amid Shortage

Industry representatives believe the disruption is linked to supply chain disturbances triggered by the conflict involving Iran, Israel and the United States in West Asia. The issue is also being reported in other cities, including Bengaluru, where hotel associations have warned that commercial LPG deliveries have suddenly stopped. The Bengaluru Hotels Association has urged the Union government to intervene immediately, restore gas distribution and prevent further closures, noting that hotels provide essential food services to a large section of the population, including students, workers and senior citizens who depend on affordable meals.

Meanwhile, industry body AHAR has sounded an alarm over the potential long-term impact of the crisis on the hotel and restaurant sector. Representatives warn that if gas supply disruptions and black market sales continue, the hospitality industry could face significant financial losses and widespread closures. They emphasise that commercial kitchens depend entirely on LPG cylinders, making uninterrupted supply critical for daily operations. Hotel associations have now urged authorities and oil companies to act quickly, curb black marketing and stabilise supply lines to prevent further disruption to Mumbai’s food service sector.