Hormuz Disruption Fears: India To Face Crude Oil, LPG Supply Issues? Govt Sources Clarify

(MENAFN- Live Mint) India is in a "very comfortable position" when it comes to the availability of crude oil, petroleum products and LPG supplies amid fears of possible interruptions through the Strait of Hormuz, reported ANI, citing government sources.

They added that the country has access to a wider range of energy supplies than could be affected by disruptions in the Strait of Hormuz. India's current reserves of crude oil and petroleum products are reportedly sufficient to fulfil domestic demand.

They mentioned that the government is keeping a close watch on the situation and intends to increase supplies from alternative regions to counter any potential supply constraints in the Strait of Hormuz.

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They also noted that India has considerably diversified its crude oil import sources in recent years. Since 2022, the country has begun importing crude from Russia. While Russia accounted for just 0.2% of India's total crude imports in 2022, its share has grown significantly since then.

"In February, India imported about 20% of its total crude oil imports from Russia, amounting to around 1.04 million barrels per day," sources said.

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Reports claiming a closure of the Mangalore Refinery and Petrochemicals Limited (MRPL) refinery are not true, they asserted, stating,“MRPL refinery is fully operational and well stocked with adequate crude supplies”.

Regarding LPG, the government has instructed all refineries to increase production to ensure sufficient supply nationwide. Officials said India remains in a comfortable position regarding LPG reserves.

Sources added that LPG shipments from the United States have begun arriving in India since January. Indian public sector oil companies had signed a one-year agreement in November 2025 to import around 2.2 MTPA of LPG from the US Gulf Coast for the 2026 contract year.

It further noted that authorities are also considering diverting petrochemical production for domestic consumption to reduce demand pressure on the energy sector.

'Plenty of oil in the market': IEA chief

Meanwhile, International Energy Agency (IEA) chief Fatih Birol on Friday aimed to ease concerns about a potential global oil crisis as tensions continue to escalate in the Middle East, saying there was“plenty of oil in the market”, according to AFP.

The US–Israel war on Iran and Iran's retaliatory strikes across the Gulf region have pushed crude oil prices higher, raising fears of another surge in inflation that could affect the global economy.

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Speaking to reporters in Brussels, Birol said the war had caused "logistical disruption", which was "creating challenges for many countries", but stressed that global oil supplies remained sufficient.

When asked whether the IEA was considering releasing emergency reserves, Birol said "all options are on the table", but added that "at this stage" there were no plans for "collective action".

"There is plenty of oil; we have no oil shortage. There is a huge surplus in the market. We are facing a temporary disruption, a logistical disruption," he mentioned.

Although Iran has not formally closed the Strait of Hormuz, a key route through which about one-fifth of the world's crude oil and significant volumes of gas pass, shipping traffic through the strategic waterway has nearly come to a halt.

Earlier this week, Donald Trump, the president of the United States, vowed to safeguard vessels travelling through the route, but oil prices have remained high.

The ongoing conflict has driven crude prices up by roughly 20 per cent since 27 February, the day before the attacks began. The International Energy Agency was established to coordinate global responses to major supply disruptions following the 1973 oil crisis.

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