Amid escalating geopolitical tensions in the Middle East, particularly following U.S. and Israeli actions in Iran, India's government has assured its citizens that the country's fuel supply remains secure. Petroleum and Natural Gas Minister Hardeep Singh Puri affirmed that India is well-prepared to handle any potential disruptions, emphasizing the diversification of supply routes and the maintenance of strategic fuel reserves.
India, the world's third-largest oil importer and consumer, has historically relied on the Middle East for a significant portion of its crude oil needs. However, recent shifts in geopolitical dynamics, including the Russia-Ukraine conflict and escalating tensions in the Middle East, have prompted a strategic re-evaluation of India's energy sourcing. The Strait of Hormuz, a critical chokepoint through which approximately 20% of global oil and gas demand flows, has been a focal point of concern, especially with Iran's threats to potentially close it in response to Western pressures.
In response to these challenges, India has actively diversified its crude oil import sources. A key aspect of this strategy involves increasing imports from Russia and the United States. Due to Western sanctions and European boycotts following Russia's invasion of Ukraine in February 2022, Russian oil became available at discounted rates, leading India to significantly increase its procurement. Preliminary data for June 2025 indicates that India's refiners are expected to import 2 to 2.2 million barrels per day (bpd) of Russian crude oil, marking a two-year peak. This volume surpasses the combined imports from traditional Middle Eastern suppliers such as Iraq, Saudi Arabia, the UAE, and Kuwait, which are projected to total around 2 million bpd for the same period. Simultaneously, American oil shipments to India have also seen a substantial increase, reaching approximately 439,000 bpd in June, up from 280,000 bpd the previous month.
This diversification extends beyond Russia and the U.S. The Indian government is also exploring alternative sources in countries like Nigeria, Angola, and Brazil, albeit with potentially higher freight costs. This multi-pronged approach aims to reduce India's dependence on any single region and enhance its energy security.
In addition to diversifying import sources, India is also strengthening its domestic energy infrastructure. The Indian Strategic Petroleum Reserve (SPR) is a crucial component of this strategy, designed to provide an emergency fuel supply in the event of external disruptions. As of December 2024, India's crude reserves were around 3.61 million tonnes, about 67% of their rated capacity. The current capacity of the SPR is 5.33 million metric tons of crude oil, sufficient to cover approximately 9.5 days of consumption. These reserves are stored in underground locations in Mangalore, Visakhapatnam, and Padur, providing ready access to refineries on both the east and west coasts of India. Further expansion of these reserves is underway, with plans to construct new facilities and double the capacity of existing ones.
Moreover, Indian refiners have been adapting to process a wider variety of crude oils, enhancing their flexibility to respond to changing market conditions. The government is also promoting initiatives like the ethanol blending program to reduce dependence on fossil fuels and curb emissions, targeting 20% ethanol blending in petrol by 2025-26.
