Indian refiners are sourcing additional crude from the US, Russia, and West Africa to ensure domestic supplies amid escalating tensions in the Middle East, officials and analysts said.
Refineries have deferred planned maintenance shutdowns and are maintaining normal processing rates to build inventories capable of meeting near-term demand. India imports about 88 per cent of its crude requirement, with nearly half passing through the Strait of Hormuz, a critical energy corridor between Iran and Oman.
The recent strikes by the US and Israel on Iran, and Tehran’s retaliatory attacks on US bases and Israel, have disrupted tanker movements through the strait, raising supply concerns. A top oil ministry official said, “Non-strait sources are fully operational and we are sourcing more and more supplies from non-conflict zones. Non-Strait sources accounted for 60 per cent of supplies in 2025 which after the Middle East conflict climbed to 70 per cent.”
Indian refiners are sourcing crude from West Africa, Latin America, and the US. The US Treasury Department issued a 30-day waiver permitting the delivery of Russian crude already loaded onto vessels, valid until April 5, allowing shipments to India without violating sanctions.
Industry sources said about 15 million barrels of Russian crude are on tankers near India, with another 7 million barrels close to Singapore. Reliance Industries, Hindustan Petroleum Corporation Ltd, and HPCL-Mittal Energy, which had halted purchases following US sanctions on Rosneft and Lukoil in October 2025, have resumed sourcing. Before sanctions, Reliance imported over 500,000 barrels per day under a long-term supply agreement with Rosneft.
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The oil ministry official said, “We are in a very comfortable position as far as crude and finished products are concerned,” adding that inventories can meet demand for 50 days. India currently holds about 144 million barrels of crude in onshore storage, equivalent to 30 days of coverage. Strategic Petroleum Reserves add roughly 9.5 days, while state-run companies hold sufficient reserves for another 64.5 days, giving total coverage of about 74 days of net imports.
Analysts cautioned that sourcing from non-Middle Eastern suppliers could raise costs due to higher crude prices, longer shipping routes, and increased freight and insurance. International crude has surged above USD 92 per barrel from around USD 70 when US and Israel attacked Iran, while LNG prices have more than doubled to USD 24–25 per million BTU.
Higher crude prices will push up India’s import bill and current account deficit, with a USD 10 increase potentially adding 20–25 basis points to the consumer price index if passed to consumers. India, the world’s third-largest crude importer, depends on Middle East supplies for about half its imports. In February, it received 2.8 million bpd from Iraq, Saudi Arabia, UAE, Kuwait, and Qatar. Globally, about 15 million bpd of crude and 5 million bpd of oil products pass through the Strait of Hormuz annually.
While India can maintain adequate physical crude supplies, analysts said sustained high prices will increase costs and pressure the rupee. The government and refiners are monitoring markets closely, ensuring that buffers remain sufficient as geopolitical tensions continue.
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