India Bolsters Domestic Oil Exploration Amid Strait of Hormuz Crisis
India is taking steps to boost domestic oil and gas exploration to enhance its energy security amid supply disruptions that drive up energy prices. The country's government has launched a $8.8 billion National Offshore Exploration Scheme, which will provide financial support of up to 50% of the cost of drilling deepwater exploration wells.
According to Abhijit Majumder, Director of Finance at Oil India Limited (OIL), disruptions to global supply chains and major energy corridors can have an immediate impact on energy flows, prices, and economies worldwide. He mentioned the Strait of Hormuz crisis as an example of how geopolitical instability in one corner of the world could threaten energy security in all other regions.
India's domestic crude oil production has declined for three consecutive years, prompting the government to take action. The National Offshore Exploration Scheme aims to encourage investment and accelerate the development of India's offshore hydrocarbon potential by providing financial support and reducing exploration risk.