The Strait of Hormuz is virtually closed due to the Iran-US war. In the meantime, Yemen's Iran-backed armed group, the Houthis, has started another game. They are continuously attacking the west coast of Saudi Arabia. The country's 'East-West Oil Pipeline' is also under attack. Due to this, Riyadh was forced to close it. In this situation, Saudi Arabia's government oil refining company Aramco has stopped supplying oil to India. The question is, will New Delhi face a crisis as a result?
After the Strait of Hormuz disruption, the 'East-West Oil Pipeline' was used as the main alternative route for oil supply. But there was an attack late last week. Since then that road has been closed. The price of oil in the world market is rising. On Wednesday, the price of 'Brent Crude' reached around 106 dollars per barrel. According to sources, Aramco has cut off oil supplies to India – both through the Red Sea and the Strait of Hormuz – but Saudi has sold some 'spot cargo' to traders, according to experts. As a result, a small amount of that oil can reach Indian refineries through Hormuz.
On the other hand, some traders are buying Iraqi crude oil at a steep discount and taking it across Hormuz to the Gulf of Oman. There, oil is transferred from one ship to another and sent to buyers in various countries including India. Supplying oil on this circuit naturally increases the cost of transportation. In a statement, Aramco told Indian refineries that they will not be able to supply crude oil until further notice. Notably, Saudi Arabia is one of the major suppliers of crude oil to India. About 9 to 14.5 percent of India's oil demand comes from here. Although this rate varies every month.