India’s crude supplies from the Middle East have not faced any disruption despite regional tensions, with reduced dependence and diversification providing a buffer against any future escalations, senior government officials, refiners and analysts said.
The tensions in the Middle East reached a new high after Tehran threatened to close the Strait of Hormuz following the US strikes on Iranian nuclear facilities, prompting refiners across Asia to brace for potential disruptions in their Middle Eastern crude deliveries and consider stockpiling feedstock crude as a precautionary measure.
“There has been no disruption of supplies. All our cargoes from the Middle East to India are on schedule,” said a source at a leading oil supplier to India.
Russian imports accounted for about 35% of India’s total crude requirements in 2024, which was nearly 4.9 million b/d until the end of December, data from S&P Global Commodities at Sea(opens in a new tab) showed. While India continued to buy relatively smaller volumes from regions like Latin America and Africa, the Middle East and Russia together accounted for nearly 80% of India’s crude imports.
“We have diversified our supplies in the past few years and a large volume of our supplies do not come through the Strait of Hormuz now. Our oil marketing companies have supplies for several weeks and continue to receive energy supplies from several routes,” said Hardeep Puri, India’s petroleum minister.
Another government source added, “A few years ago, we used to source more than 60% of our crude from the Middle East. Now, it’s less than 45%. This diversification will help us in case we witness any long period of turbulence in the Middle East.”
High-risk zone
Shipping lines have been affected with commercial ships avoiding Iranian waters, and several tankers making U-turns or pausing near the strait since the US struck Iranian nuclear sites. Understandably, crude prices have jumped. For now, the Strait remains operational, but global players have been treating it as a high-risk zone.
“India is far better positioned today to manage such a scenario than it was just a few years ago. Nearly 40% of our crude now comes from Russia — delivered via Arctic, Black Sea, and Pacific routes,” said Shrikant Madhav Vaidya, former chairman of state-run Indian Oil Corp.
“In addition, growing volumes from the US Gulf, West Africa, and Latin America mean that more than half of our oil imports bypass Hormuz entirely. This is not a short-term workaround — it reflects a deliberate long-term shift in our sourcing strategy,” he added.
Vaidya added that India also maintains robust inventory buffers — both commercial and strategic — providing a cushion of well over two months. So, while any disruption at Hormuz may lead to price and freight volatility, India is unlikely to face physical supply stress in the short term. “The dependency on a single chokepoint no longer defines our energy security framework.”
India’s strategic petroleum reserves currently can provide supplies for about 9.5 days of net oil imports. State-run oil companies hold storage facilities for crude oil and petroleum products for 64.5 days of total net imports, bringing the current total national storage capacity of crude and petroleum products to 74 days of total net imports.
On the other hand, IEA member countries are required to ensure oil stock levels equivalent to at least 90 days of their net imports.
As a result, some analysts added that India could face supply pressure if the Middle East witnessed a prolonged conflict.
“India is exposed to the situation in the Strait of Hormuz — economically, strategically, and diplomatically. India was also expected to resume Iranian oil purchases after the potential revival of the nuclear deal. That window now seems closed, and the country will have to continue with its existing basket of sellers,” said Rajat Kapoor, managing director for oil and gas at Synergy Consulting.
Prices a bigger worry
US crude oil futures moved sharply lower early in the June 24 trading day after US President Donald Trump said Israel and Iran have agreed to a ceasefire.
At 2217 GMT, NYMEX August WTI was down $3.16 at $65.35/b. The decline extends significant losses seen in the previous session after Iran signalled a willingness to de-escalate after launching a limited retaliatory strike on a US airbase in Qatar. The front-month NYMEX crude contract settled 8.6% lower, and prompt-dated ICE Brent declined 7.2% June 23.
Indian oil industry sources said that the relatively bigger impact for India would be rising prices.
“Crude oil may continue to see the impact of high freight rates and war premiums for some time. It could be inflationary,” said DLN Sastri, director for oil refining and marketing at the Federation of Indian Petroleum Industry.
Source: Platts