India's Crude Oil Output Falls 3% to 27.96 MMT in FY26; Centre Plans ₹84,084 Crore Offshore Drive

India's domestic crude oil production declined for the third consecutive financial year to 27.96 million metric tonnes (MMT) in FY26, according to data shared by Oil and Natural Gas Minister Hardeep Singh Puri in Lok Sabha.

The decline reflects continued output losses from ageing and mature oilfields, with production down 2.57 per cent from 28.70 MMT in FY25 and 4.76 per cent lower than 29.36 MMT recorded in FY24.

State-run national oil companies have also registered a gradual decline, with Oil and Natural Gas Corporation (ONGC) producing 17.80 MMT in FY26 against 18.47 MMT in FY25 and 19.21 MMT in FY24, while Oil India Ltd. (OIL) produced 3.43 MMT during FY26, largely unchanged from 3.44 MMT in the previous year.

The government attributes the decline to natural depletion in mature and ageing oil and gas fields, but notes that ONGC and OIL have managed to contain the annual production decline to around 2% since 2014-15, compared with the global average decline rate of about 6% for mature fields, citing International Energy Agency estimates.

The government plans to address this issue through various initiatives, including the 'Samudra Manthan', National Offshore Exploration Scheme, approved by the Union Cabinet on July 31, 2026, with an outlay of ₹84,084 crore through FY2030-31. The scheme aims to strengthen India's energy security through accelerated offshore oil and gas exploration and production, technological capability enhancement, and alignment with the vision of Viksit Bharat.