India's Oil Supply Resilience Amid Strait of Hormuz Tensions

India is currently in a strong position to manage potential disruptions in oil supplies following the closure of the Strait of Hormuz. With crude inventories sufficient for at least 10 days and fuel stocks covering another 5-7 days, the country is unlikely to face immediate shortages. Officials have indicated that contingency plans are in place to diversify supply sources if necessary. The situation is being closely monitored, especially as global oil prices rise amid geopolitical tensions. This article explores India's preparedness and the implications of the ongoing crisis.

By Narendra Chaudhary Mar 1, 2026, 16:35 IST

Overview of India's Oil Supply Situation

New Delhi, Mar 1: India appears well-prepared to handle any immediate disruptions in oil supplies, thanks to its substantial crude inventories, which can sustain the country for at least 10 days. Additionally, fuel reserves are adequate for another 5 to 7 days, even with the recent reports of the closure of the strategic Strait of Hormuz.

According to officials, a temporary closure would have minimal effects on India, as refineries currently maintain 10 to 15 days' worth of crude oil, both in storage and transit, while fuel tanks are filled to meet domestic demand for 7 to 10 days.

“Indian refineries collectively hold between 10 to 15 days of crude oil, both in tanks and in transit. Moreover, all fuel tanks are full, capable of meeting the country's fuel needs for 7-10 days,” an official stated.

“At this point, we anticipate that the closure of the Strait of Hormuz will not last long,” he added.

Nonetheless, contingency measures are ready should tensions escalate. If a prolonged disruption occurs, India can adjust its import strategies by sourcing from a variety of suppliers, including increasing its intake of Russian crude.

Data from Kpler vessel tracking indicates that approximately 2.5 to 2.7 million barrels per day, which constitutes about 50% of India's crude oil imports, pass through the Strait of Hormuz, primarily from Iraq, Saudi Arabia, the UAE, and Kuwait.

Furthermore, nearly 60% of India's liquefied natural gas (LNG) imports also transit this route, mainly from Qatar and the UAE. The country relies heavily on the Strait for LPG imports, making cooking gas supplies particularly susceptible to any extended disruptions.

On February 28, Iranian state media reported that the Strait of Hormuz had been closed in response to missile strikes, marking a critical point for global energy supplies, as about one-fifth of the world's oil and gas passes through this chokepoint.

The immediate impact of this crisis is likely to be reflected in rising oil prices. Brent crude closed the previous week near seven-month highs at approximately USD 73 per barrel, marking a 16% increase since the beginning of the year.

Traders are preparing for increased volatility, with some forecasts suggesting prices could reach USD 80 per barrel if supply chains are disrupted.

Another official emphasized that global crude availability remains sufficient, and India can source oil from as far away as Venezuela, Brazil, and Africa if necessary.

“India had reduced its purchases from Russia due to US pressure, but we can resume buying from Moscow if there is a disruption in the Middle East,” he noted.

“The only consideration is transit time. It takes five days for a ship from the Middle East to reach India, while shipments from Russia take at least a month. Thus, timely order placement is crucial,” the official explained.

Officials also highlighted India's strategic petroleum reserves, which can cover about a week's worth of requirements, serving as an additional safety net.

The situation for LNG could become more precarious if the closure persists, as most LNG volumes are tied to long-term contracts, leaving only limited quantities available on the spot market.

Prices may surge if major consumers like India or China seek alternative supplies. A similar vulnerability exists for LPG supplies.

The government is actively monitoring the situation and exploring alternatives, according to a separate official.

Sumit Ritolia, Lead Research Analyst at a commodity analytics firm, remarked that while India's recent shift back to Middle Eastern crude has increased its exposure to risks associated with Hormuz, the chances of a prolonged blockade remain low.

“Diversified sourcing, options for Russian crude, and layered inventory buffers, including strategic petroleum reserves and commercial stocks, significantly mitigate the risk of sustained shortages. The primary near-term concern is price volatility and its macroeconomic impact, rather than structural supply insecurity,” he stated.

Brent futures settled at USD 72.87 per barrel on February 27 after reaching an intraday high of USD 73.54, the highest since July 30, 2025, with crude prices climbing over USD 12 per barrel this year amid escalating geopolitical tensions.

This assessment comes in light of rapidly evolving events following military strikes by the United States and Israel on Iran, including reports from Iranian state media regarding the death of the Islamic Republic’s Supreme Leader.