India's Energy Security Threatened by Reliance on Imported Crude Oil
India's reliance on imported crude oil makes its energy security vulnerable to external events, according to economist D K Srivastava. He explained that India's petroleum vulnerability is macroeconomic in nature, affecting not only producers but also consumers through supply bottlenecks and higher prices.
Srivastava suggested that holding sufficient strategic reserves could cushion short-term supply disruptions, limit the impact of excessive price volatility, and support macro-stability by containing pressure on inflation, the exchange rate, current account, and fiscal balances.
The economist emphasized the need for India to revisit its energy security strategies, particularly in light of the West Asia conflict. He proposed strengthening strategic reserves, diversifying crude sources, maintaining refining flexibility, and building policy buffers against global supply and price volatility.