The landlocked Himalayan nation of 30 million relies almost entirely on India for its fossil fuel needs.

About 90 percent of India's liquefied petroleum gas (LPG) passes through the Strait of Hormuz, a strategic chokepoint where maritime traffic has largely stalled.

As supplies tighten, New Delhi has prioritised households, transport, and other essential sectors such as hospitals.

Nepal, however, said it still has sufficient gas but has reduced cylinder volumes to stretch the available supply.

"A decision was made to begin selling half-filled cylinders," government's Nepal Oil Corporation spokesman Manoj Kumar Thakur told AFP.

"Our supply remains intact but the war in the Middle East, and news of shortages, has caused resourceful consumers to buy more than they need," he added.

"This has meant that people who only have a single cylinder in their homes are not getting to buy. This way, our supply will reach more households."

Indian Prime Minister Narendra Modi said he spoke with Iranian President Masoud Pezeshkian on Thursday, emphasising that "unhindered transit of goods and energy" remains a top priority for New Delhi.

Nepal's electricity, by contrast, is largely generated from hydropower dams on its mountain rivers, allowing it to export electricity to coal-dependent India.