NEW DELHI – India successfully navigated a severe energy crisis triggered by the effective closure of the Strait of Hormuz earlier this year, a critical maritime chokepoint for global oil and gas trade. Union Petroleum and Natural Gas Minister Hardeep Singh Puri detailed the nation's proactive strategy in an editorial for The Economic Times, highlighting how long-term planning, rather than reactive measures, shielded India from widespread disruption.
Strategic Preparedness Amid Geopolitical Tensions
The Strait of Hormuz, through which nearly one-fifth of the world's oil and gas passes, faced significant disruption in late February due to escalating geopolitical tensions. For India, which relies on imports for over 85% of its crude oil requirements, this presented an immediate threat to fuel supplies, LPG availability, and economic stability. Yet, four months later, the country has emerged largely unaffected.
Puri emphasized that the Indian government prioritized protecting its citizens, particularly the most vulnerable, from unprecedented supply and price volatility. This commitment was underpinned by years of strategic investments in energy infrastructure and a deliberate reduction in dependence on a limited group of suppliers.
Diversified Sourcing and Domestic Boost
A significant challenge arose in the supply of Liquefied Petroleum Gas (LPG), with nearly 60% of India's imports previously sourced from West Asia. When these supplies sharply diminished, the government swiftly redirected refinery operations to boost domestic LPG production. Refineries, some not previously configured for cooking gas, were re-tasked within days, increasing daily production from 35 TMT (Thousand Metric Tons) to 54 TMT.
Furthermore, India secured alternative cargo routes and diversified its import partners. LPG shipments were rerouted through ports outside the Gulf region, and new supply agreements were established with nations including Algeria, Japan, and Canada. At the crisis's peak, more than a dozen Indian LPG vessels were strategically repositioned to ensure continuous supply chains.
Protecting Consumers from Price Shocks
To prevent shortages and guard against hoarding, the Centre implemented digital authentication for LPG deliveries and imposed consumption limits on household cylinders. Commercial LPG distribution was also closely monitored, ensuring domestic consumers remained protected.
One of the most impactful outcomes was the containment of cooking gas prices. Despite international LPG benchmark prices nearly doubling during the crisis, domestic consumers continued to receive subsidized cylinders at significantly lower rates. Puri noted that a cylinder, which would have cost over ₹1,600 at import-linked rates, still reached Ujjwala scheme beneficiaries at ₹642, with the government absorbing substantial losses to shield the populace.
Investing in Long-Term Energy Resilience
Puri underscored the broader resilience of India's energy ecosystem. The country now operates 24 refineries, boasts over 47,000 km of oil and gas pipelines, and maintains more than one lakh (100,000) retail fuel outlets serving millions daily.
Reflecting on the episode, Puri asserted that India's ability to withstand the disruption without emergency rationing was a direct result of sustained, long-term investments. He concluded, "The widening of India's crude basket, doubling of import terminals, and pipelines and reserves built across a decade were not abstractions when Hormuz closed. They were the very reason the lights stayed on."