India improvises as Strait of Hormuz remains closed, impacting global energy flows
The Strait of Hormuz remains practically closed six months after the war began, forcing India to improvise its energy supply strategy. Iran and Oman are negotiating a transit corridor, but Washington's stance limits Iran's leverage. India, with minimal strategic reserves, has scrambled to build alternative supplies, primarily Russian crude and U.S. LPG, while relying on demand destruction and refinery expansion. The analysis highlights China's increasing competition for Russian oil and the depletion of IEA's strategic reserves. The disruption has led to longer voyages, higher prices, and increased under-recoveries for Indian oil companies.
Key Points
- The Strait of Hormuz remains largely closed, forcing India to adapt its energy supply strategy.
- India is diversifying supplies with Russian crude and U.S. LPG, and augmenting domestic production.
- China's growing competition for Russian oil and the depletion of IEA's strategic reserves are significant factors.
- The closure has resulted in longer shipping voyages, higher prices, and increased under-recoveries for Indian oil companies.
Exam Facts
- Average Strait of Hormuz flows are close to 0.25 million barrels a day, down from 15 million before the war.
- India's strategic oil storage is 5.33 million tonnes, lasting nine days.
- IEA's 400-million-barrel strategic reserve release is mentioned.
- Kpler estimates America supplied 60% of India's LPG imports in May.
Read it. Retain it. Recall it.
Get spaced-repetition flashcards, daily quizzes and offline access — free on Android.