New Delhi: The war that began in West Asia on February 28 disrupted world energy supply chains. Missile strikes, maritime tensions and attacks on shipping lanes created uncertainty in oil transport. During this period, Iran moved to close the Strait of Hormuz, a narrow but crucial route through which nearly one-fifth of the world’s crude oil passes. The move also affected shipments of LPG and LNG, tightening supply conditions in several regions.
India, which depends on imports for nearly 90 percent of its crude oil needs, was directly exposed to this disruption. Still, the country managed to maintain supply stability through a mix of diversification, alternative sourcing and refinery adjustments rather than relying on a single supplier or route.
Around 60 days of buffer stock support
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According to government estimates, India holds about 60 days of crude oil supply when strategic reserves and commercial inventories are combined. Even during a period of nearly two and a half months when about 20 percent of world crude flows were disrupted, domestic demand in India continued to be met without major disruption.
This stability came largely from a rapid change in import sources and flexible refining strategies adopted by Indian refiners.
Change in import strategy
India’s crude import strategy changed from March 2026. With disruptions in the Hormuz region, supplies from the Middle East declined and shipping risks increased. Indian refiners increased purchases from the Atlantic Basin and other non-traditional sources.
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Shortfalls from Iraq and Gulf suppliers were compensated by higher imports from the United States, Brazil, West Africa and Venezuela. This was not a simple replacement of one supplier with another but a broader restructuring of crude sourcing based on availability, freight cost, refinery compatibility and sanctions-related constraints.
Refiners increasingly turned to Russian crude along with Atlantic Basin grades. At the same time, they also resumed limited purchases of certain Saudi and the United Arab Emirates (UAE) grades that had earlier been deprioritised.
Russian oil becomes the backbone
Since the Ukraine war in 2022, Russia has emerged as a major supplier for India’s crude oil imports. While there was a brief dip between December 2025 and February 2026 due to US sanctions, Russian crude continued to be a dominant component of India’s energy basket.
Kpler data shows that Russian imports reached around 1.9 to 2.0 million barrels per day in March and have stayed near similar levels in May. Since the beginning of the war, Russia has supplied more than 140 million barrels of oil to India.
Crude moving through Baltic, Black Sea and Pacific routes is largely insulated from risks posed by the Strait of Hormuz, making it a stable supply option for Indian refiners.
Middle East supply and alternative routes
In April, India’s total crude imports dropped to around 4.4 million barrels per day, compared to a normal level of about 5.2 million barrels per day. Imports from Iraq fell during this period.
Refiners adjusted their crude basket. Russia accounted for about 30 to 37 percent of total imports or roughly 1.5 to 1.7 million barrels per day.
Saudi Arabia and the UAE continued to supply around 0.65 to 0.70 million barrels per day and 0.60 to 0.62 million barrels per day respectively. Venezuela, Brazil and Iran also contributed to the overall mix.
Middle Eastern crude was increasingly routed through alternative corridors such as Saudi Arabia’s East-West pipeline via Yanbu on the Red Sea and the UAE’s Habshan-Fujairah pipeline. These routes bypass Hormuz but add around 4 to 10 days in transit time and increase shipping costs.
Venezuela makes a comeback
After years of sanctions-related restrictions, Venezuelan oil exports to India resumed following policy changes under the Trump administration. Supplies rose between April and May, and Venezuela emerged among the top five suppliers after the outbreak of the US-Iran war.
Venezuelan grades are particularly suited to India’s complex refineries as they help balance lighter crude blends and improve middle distillate output.
Supply shortfall and ongoing challenges
Kpler estimates that India’s crude imports are still about 700,000 to 800,000 barrels per day below normal levels due to world supply constraints and disruptions caused by the closure of Hormuz. While new sources have helped diversify supply, they have not fully replaced Middle Eastern volumes.
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Analysts expect the present crude mix to continue in a similar pattern, with Russia serving as the core supplier supported by the Atlantic Basin and Venezuela. Refiners are expected to continue prioritising supply security, cost efficiency and refinery optimisation.
Domestic policy response
To manage demand, retail fuel prices for petrol and diesel were increased by Rs 3.90 per litre after four years of stability. The government also imposed a windfall gains tax to discourage excessive fuel exports and ensure domestic availability.
These measures are aimed at balancing refinery economics while maintaining stable supply for domestic consumers.
