Hormuz Crisis: India Emerges Unscathed Thanks to Preparedness

India recently weathered a severe energy disruption at the Strait of Hormuz without experiencing fuel or LPG shortages. The crisis, which closed the waterway that carries one-fifth of the world's crude oil and natural gas, had been feared for decades but never materialized.

The government managed to keep every kitchen and pump supplied through a combination of daily work, production increases, and imports from non-Gulf sources. Refineries ran above capacity, additional kerosene was allocated to states, and LPG production was raised by 28% within the first five days.

One key factor in India's success was its preparedness. The country had widened its crude supplier basket from 27 nations to 41 over a decade and increased the share of imports traveling beyond Hormuz from 55% to 70%. Strategic reserves were filled at Visakhapatnam, Mangaluru, and Padur.

The government also took steps to shield consumers from price shocks. Central excise on petrol was cut from Rs 13 to Rs 3 a litre in late March, and on diesel to zero; retail revisions since have been minimal.