India is stepping up diplomatic and supply-side efforts to safeguard its energy flows as tensions in West Asia disrupt shipping through the Strait of Hormuz, a vital corridor for crude oil and LPG supplies.
New Delhi is in active talks with Iran to secure safe passage for more than 20 tankers, including vessels carrying LPG and crude contracted by Indian refiners. The negotiations are being handled on a ship-by-ship basis, reflecting the fragile security situation in the region. External Affairs Minister S. Jaishankar said the engagement with Tehran has already helped some vessels transit the strait, though there is no overarching arrangement yet.
India’s urgency is driven by its heavy dependence on the Gulf for energy supplies. Nearly 90 percent of LPG imports pass through the Strait of Hormuz, while 60–65 percent of domestic demand is met through imports. Key suppliers include Saudi Arabia, Qatar and the United Arab Emirates. Any prolonged disruption threatens household cooking fuel supplies as well as feedstock for petrochemical industries.
Despite some progress, the situation remains tense. More than 20 India-flagged vessels are still stranded in the Persian Gulf, including LPG carriers, crude tankers and an LNG vessel. Shipping risks continue to remain elevated amid the ongoing geopolitical uncertainty.
To reduce dependence on Gulf routes, India is accelerating efforts to diversify sourcing. Oil marketing companies and refiners are scouting cargoes from a wider pool of suppliers, including the United States, Canada, Norway, Algeria and Russia. Imports of Russian crude, particularly Urals grade, have also been ramped up following temporary easing of sanctions. A report by Morgan Stanley noted that India is combining diplomatic outreach with aggressive sourcing to manage the disruption.
At the domestic level, the government has moved to cushion supply pressures by directing refineries to maximise LPG production and divert propane and butane for cooking fuel. Oil marketing companies have been instructed to prioritise household consumption, while urban consumers are being encouraged to shift to piped natural gas where available to conserve LPG cylinders.
Policy measures have also been introduced to manage demand. A Natural Gas Control Order ensures full supply to priority segments such as domestic PNG and CNG, while supplies to industrial and commercial users are being regulated.
The disruption in the Strait of Hormuz is not just an Indian concern but a broader Asian risk. Analysts warn that the region could be facing a rare energy supply shock, with potential spillover effects on chemicals, fertilisers and other energy-intensive sectors.
For India, ensuring the steady movement of tankers while diversifying supply sources has become a critical strategic priority as geopolitical tensions reshape global energy flows.
