West Asia Crisis Looms: India's Oil Supplies at Risk of Disruption
India's Oil Minister Hardeep Singh Puri has warned that the ongoing West Asia crisis could worsen and pose supply challenges for India. Despite navigating the crisis so far, Puri cautioned that escalating tensions between the US and Iran could disrupt global oil supplies.
The Strait of Hormuz and Bab-el-Mandeb are critical chokepoints in international trade, and their closure would severely impact global energy flows. Currently, the global supply of 102 million barrels per day exceeds demand by around 7-8%, but a significant disruption to these key routes could change this dynamic.
India has managed to maintain fuel availability despite the challenges, thanks in part to its robust refining capacity of 267 million tonnes per annum. The government plans to increase this capacity to 320 mtpa by 2030 and is also seeking investment from countries like Saudi Arabia and the UAE for upcoming refineries.
India continues to export around 1 million barrels of refined fuel products, despite some countries imposing export bans. Puri emphasized that India will continue to honor its contractual commitments to export petroleum products.