India's oil supply chain remains secure despite escalating tensions in the Middle East and the possibility of the Strait of Hormuz being closed, according to recent statements. The Strait of Hormuz is a critical maritime passage, handling approximately 20% of global oil and gas transportation. The recent US airstrikes on Iranian nuclear facilities have heightened tensions, leading Iran's Parliament to approve a motion to potentially close the Strait. The final decision, however, rests with Iran's Supreme National Security Council.

India relies heavily on crude oil imports, with about 90% of its needs being met through foreign sources. Around 2 million barrels per day (bpd) of India's total 5.5 million bpd oil imports pass through the Strait of Hormuz. The potential closure of this waterway raises concerns about the impact on India's energy security.

Despite these concerns, India's oil supply chain is considered safe due to several factors. Firstly, India has diversified its sources of oil imports in recent years. While Middle Eastern nations like Iraq and Saudi Arabia have traditionally been major suppliers, India has expanded its imports from Russia, the United States, and Brazil. Notably, Russian oil supplies are not affected by disruptions in the Strait of Hormuz, as they utilize alternative routes like the Suez Canal, the Cape of Good Hope, or the Pacific Ocean. Supplies from the US, West Africa, and Latin America also provide viable alternatives, although they may be more expensive.

Secondly, India's gas supplies are also expected to remain unaffected. Qatar, India's primary gas supplier, delivers gas without using the Strait of Hormuz for Indian shipments. Additional LNG sources from Australia, Russia, and the US remain accessible regardless of any Strait of Hormuz closure.

India also possesses strategic petroleum reserves that can cover approximately 9-10 days of imports. These reserves can be tapped into in case of any supply shortfall. Furthermore, the government may consider offering price subsidies to contain inflation, particularly on diesel and LPG, if global crude prices surge.

However, analysts predict that increasing tensions in this significant energy supply region could cause short-term price fluctuations, potentially pushing oil prices towards $80 per barrel. Experts also warn of a likely spike in freight rates and insurance costs, with knock-on effects for India's trade with Europe and the US.

In summary, while the potential closure of the Strait of Hormuz poses a risk to global energy supplies, India's diversified sourcing strategies, strategic reserves, and strong diplomatic ties provide a buffer against major disruptions. While near-term oil prices may experience some volatility, India is well-prepared to manage the situation and ensure the stability of fuel supplies for its citizens.