New Delhi: India is comfortably placed to meet its fuel supply needs, said Minister for Petroleum and Natural Gas Hardeep Singh Puri in a post on X after a review meeting with the heads of India's national oil PSUs. "As oil is on the boil, all eyes are on the ball… In the increasingly volatile geopolitical situation, reviewed the petroleum products supply situation with @PetroleumMin officials and our PSU OMCs. Under the visionary leadership of PM @narendramodi Ji, we have diversified our import basket substantially and are comfortably placed to meet our fuel supply needs," Puri wrote in a post on X.
Earlier in the day, Puri told reporters that India is reviewing the global crude oil supply situation on a daily basis amidst the ongoing conflict between Israel and Iran. He also said that India has adequate oil supplies and the country has sufficient stock of crude oil and gas.
The government is closely monitoring the emerging situation between Iran and Israel. Separately, Commerce Secretary Sunil Barthwal said on Monday that a meeting with shipping lines, container firms, and other stakeholders will be held this week to assess the impact on the country's overseas trade and address any issue. "We are watching the situation. We are also calling a meeting (this week) of all the shipping lines, the container organisations and the concerned departments, and stakeholders to understand from them that what are the kind of issues they are facing and how we can sort it out," he told reporters.
The conflict started on June 13 when Israel hit more than 100 major targets in Iran, including nuclear facilities and missile sites, and killed senior military commanders and scientists, in what Tehran said was a “declaration of war.” Israeli strikes have continued over the weekend and into Monday, as the Israel Defense Forces (IDF) targeted air defences around the Tehran and claimed they had gained control of the skies over the capital.
In response, Iran has launched several waves of missiles at Israel since Friday, with Israeli authorities saying at least 14 people had been killed since Friday and 390 injured.
In an unprecedented move, Israel has also attacked Iran's energy facilities, said a report by Al Jazeera. Late on June 14, Iran’s Ministry of Petroleum said Israel struck a key fuel depot, while another oil refinery in the capital city of Tehran was also in flames. Iran has also partially suspended production at the world’s biggest gasfield, the South Pars, which it shares with neighbour Qatar, after an Israeli strike caused a fire there, said Al Jazeera.
In response to these attacks, Iran is considering closing the Strait of Hormuz, Iranian news agency IRINN has reported, citing key conservative lawmaker Esmail Kosari, as the conflict with Israel intensifies, said Al Jazeera in a separate report.
India does not import significant amount of oil from Iran. However, the Strait of Hormuz is critical as nearly two-thirds of India's crude oil and half of its LNG imports pass through it. India is dependent on imports for meeting more than 85 percent of its crude oil requirement and around 50 percent of its natural gas requirement, with over 40 percent of its supplies sourced from Middle East nations such as Iraq, Saudi Arabia, the United Arab Emirates, Kuwait and Qatar which comes via the Strait of Hormuz. Oil industry executives, who spoke on the condition of anonymity, said that an escalation in war would push both air and sea freight rates and delay the delivery of cargoes. Any increase in oil prices is likely to drag the rupee higher against the US dollar, increasing inflationary pressures on the economy. On Monday, Indian Rupee inched close to Rs 86/dollar as it settled at Rs 85.96/dollar.
Since the Strait of Hormuz, which is just 21 miles wide at its narrowest point, handles nearly a fifth of global oil trade, has caused concerns about a possible disruption in supplies, sending oil prices to two-month highs over the last week. Brent crude surged ~7 percent to ~USD 74.2/bbl on June 13, with intraday spikes to ~USD 78.5 — largest intraday moves since early 2022. On Monday, prices have been oscillating around USD 74–75/bbl, showing both spikes and pull-backs.
According to think tank GTRI, any closure or military disruption in the Strait of Hormuz would sharply increase oil prices, shipping costs, and insurance premiums, triggering inflation, pressuring the rupee, and complicating India's fiscal management. A report by JM Financial said that if Iran’s crude oil supply gets disrupted by 0.5 to 1 mbpd (million barrels per day), it could lead to global crude oil prices surging by 5 to 10 dollars per barrel in the medium term.
India maintains strategic crude oil reserves which are sufficient to meet the country's oil consumption for 74 days. Out of 74 days, while Indian Oil Corporation (IOC) maintains crude oil reserves for 40-42 days, Indian Strategic Petroleum Reserves Limited (ISPRL) maintains reserves for a little over nine days, while Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Limited (HPCL) maintain the remaining back-up.
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