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Updated Mar 10, 2026 05:27 PM IST
Middle East tensions threatening the Strait of Hormuz could disrupt India’s oil, LNG and LPG supplies. With heavy import dependence and limited LPG reserves, households, industry and the broader economy face potential risks.
Highlights
- Nearly half of India’s crude, LNG and LPG imports pass through the Strait of Hormuz.
- India imports most LPG; disruptions could affect household cooking gas supply.
- India lacks strategic LPG reserves; current stocks may last only two to three weeks.
As Middle East crisis escalates, India is beginning to feel the tremors at home. Nearly half of India’s crude oil imports, along with a significant share of its liquefied natural gas (LNG) and liquefied petroleum gas (LPG) shipments, typically pass through the Strait of Hormuz -- the narrow Gulf chokepoint that is now effectively closed due to the conflict.
India’s ties with the region extend beyond energy. Around 10 million Indians live and work across the Gulf, sending home record remittances that support millions of families and contribute significantly to India’s external accounts.
More broadly, India’s economic ties with the Middle East run deep. The region accounts for 17 per cent of India’s exports, supplies 55 per cent of its crude oil and generates 38 per cent of its remittances, according to brokerage firm Jefferies.
Why Iran conflict could hit your kitchen?
The ongoing Iran conflict could have a direct impact on household kitchens in India. The country’s LPG demand stands at 31.3 million tonnes a year, with 87 per cent used in household kitchens and the remaining 13 per cent consumed by commercial establishments such as hotels and restaurants.
India is heavily dependent on imports to meet its LPG needs, with around 62 per cent of total demand met through overseas supplies. Notably, 85-90 per cent of these imports pass through the Strait of Hormuz, a critical shipping chokepoint. Most of these supplies come from Saudi Arabia and other Gulf producers, making India vulnerable to disruptions in the region.
Oil and gas dependence
Roughly a fifth of the world’s oil and gas typically passes through the Strait of Hormuz. However, recent attacks on vessels and warnings from Iran that ships attempting to cross the strait could be targeted have effectively brought traffic through one of the world’s most critical energy routes to a halt.
For India, which imports about 90 per cent of its oil needs, the exposure is significant. Nearly half of its crude oil imports, around 2.5 to 2.7 million barrels per day, pass through the strait, mainly from Iraq, Saudi Arabia, the United Arab Emirates and Kuwait.
Meanwhile, India imports around 80-85 per cent of the LPG it consumes, making it the world’s second-largest LPG importer after China. Almost all these shipments come from Gulf producers -- mainly Qatar, Saudi Arabia, the UAE and Kuwait, with nearly all passing through the Strait of Hormuz.
LNG presents a similar picture as India’s domestic gas production meets only a small portion of demand in an economy that is increasingly relying on gas for power generation, fertilisers, city gas distribution, transport and industrial use. India imported about 25 million tonnes of LNG last year, with roughly 14 million tonnes passing through the Strait of Hormuz, placing it among the world’s largest LNG buyers alongside China, Japan and South Korea.
Why LPG is more vulnerable?
What increases the vulnerability with LPG is that unlike crude oil, India holds no meaningful strategic LPG reserves and storage capacity is limited. Stocks held by refiners and distributors could meet demand for only two to three weeks if imports are disrupted.
End of article
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