What Happened
- Commerce Minister Piyush Goyal stated at the CNBC-TV18 India Business Leaders Awards that India is well-placed to handle any disruption in crude oil and fuel supplies arising from the West Asia conflict.
- The government reported good petroleum stock levels with "absolutely no disturbance" on the crude, petrol, diesel, or aviation fuel fronts as of March 14, 2026.
- As a precautionary measure, the government ramped up domestic kerosene production to serve as an alternative cooking medium in the event of LPG supply delays — a notable policy reversal given kerosene's prior phase-out under clean cooking schemes.
- Goyal also reaffirmed India's commitment to concluding a bilateral trade deal with the United States, signalling continuity in India's economic diplomacy despite the regional crisis.
- The government announced plans to develop a concrete support package for exporters in the following week, acknowledging short-term disruptions to economic activity while maintaining India's long-term growth outlook.
Static Topic Bridges
India's Strategic Petroleum Reserve (SPR)
India's Strategic Petroleum Reserve (SPR) programme was established under the Indian Strategic Petroleum Reserves Limited (ISPRL), a special purpose vehicle under the Ministry of Petroleum and Natural Gas. The SPR stores crude oil in underground rock caverns, insulated from the effects of war, terrorism, or natural disasters.
- India has three underground SPR facilities: Visakhapatnam (1.33 MMT), Mangaluru (1.5 MMT), and Padur (2.5 MMT) — total capacity of ~5.33 million metric tonnes (approximately 39 million barrels)
- Additionally, Indian refiners maintain commercial crude stocks; combined, India held an estimated 74 days of petroleum supply coverage as of March 2026
- IEA (International Energy Agency) recommends member states maintain at least 90 days of net import coverage — India is not an IEA member but benchmarks to this standard
- A Phase 2 expansion to add SPR capacity at Chandikhol (Odisha) and Padur (Karnataka) has been planned
Connection to this news: The government's confidence in supply security stems directly from the SPR buffer and high commercial stocks, which provide a 7–8 week cushion even if all Gulf imports were disrupted.
India's Changing Crude Oil Import Mix
India's crude oil import geography has shifted significantly over the past four years. Prior to 2022, West Asia (Saudi Arabia, Iraq, UAE, Kuwait) dominated India's import basket. Post-2022 Russia-Ukraine war, Russia emerged as India's top crude supplier by leveraging discounted prices under Western sanctions.
- As of 2025–26, Russia accounts for approximately one-third of India's total crude imports
- Iraq, Saudi Arabia, and UAE remain major suppliers; India also imports from the US, West Africa, and Latin America
- India imports crude from approximately 40 countries — a diversification strategy that reduces single-route dependency
- Russia-origin crude primarily arrives through alternative routes (Suez Canal, Cape of Good Hope) not affected by the Hormuz blockade
- India's crude import bill was ~$130 billion in 2022–23 when prices peaked; current levels are higher given $100+ pricing
Connection to this news: India's diversified supplier base — particularly its significant Russian crude imports not routed through Hormuz — is central to why the government can credibly claim supply security even as 22 vessels remain stranded.
Kerosene Policy Reversal and Energy Equity Considerations
India undertook a progressive phase-out of kerosene under the Pradhan Mantri Ujjwala Yojana (PMUY, launched 2016), which subsidised LPG connections for Below Poverty Line (BPL) households. Kerosene, long distributed through the Public Distribution System (PDS) as a cooking and lighting fuel, was seen as polluting and economically inefficient. Many states had already eliminated kerosene from their PDS allocations by 2023–25.
- PMUY has covered over 10 crore BPL households with LPG connections
- Kerosene combustion indoors is a significant contributor to indoor air pollution and household health risks
- The government's decision to ramp up kerosene production as a backup represents a temporary policy reversal prioritising supply security over clean energy goals
- This demonstrates the tension between energy security (ensuring availability) and energy transition (shifting to cleaner fuels)
Connection to this news: The kerosene reintroduction as backup signals that LPG supply stress is real, even as the government publicly projects confidence — it underscores the structural vulnerability that even a short Hormuz blockade creates for India's 33+ crore LPG-dependent households.
India's LPG Import Dependency from the Gulf
India imports approximately 60–80% of its LPG from Gulf countries — Qatar, UAE, Saudi Arabia, and Kuwait — most of which is shipped through the Strait of Hormuz. India is one of the world's largest LPG consumers, with LPG imports valued at approximately $13.9 billion annually from the Gulf region alone.
- India's domestic LPG production was ramped up 28% following the Hormuz disruption
- Additional LPG cargoes were sourced from the US, Norway, Canada, Algeria, and Russia as alternatives
- Qatar is India's largest LNG supplier, with long-term contracts; LNG from Qatar also transits Hormuz
- India's refinery sector was directed to maximise LPG output to protect household supplies
Connection to this news: The government's preparedness message specifically targets the LPG-dependent household sector — the single largest source of energy vulnerability — reflecting both the economic and political stakes of potential cooking fuel shortfalls.
Key Facts & Data
- India's SPR: ~5.33 MMT capacity across three facilities (Vizag, Mangaluru, Padur); ~74 days total petroleum coverage
- India imports crude from ~40 countries; Russia accounts for ~one-third of total crude imports
- LPG imports from Gulf: ~60–80% of India's total LPG, valued at ~$13.9 billion from the region
- Domestic LPG production increased 28% following Hormuz blockade
- PMUY has connected 10+ crore BPL households to LPG
- Every $10/barrel increase in crude prices: ~$10–13 billion additional annual import cost; ~0.4% wider CAD
- India maintains commercial + SPR buffer of approximately 64.5 days of crude and 74 days total