- One of the most serious energy crises in decades
- Emergency measures had to be taken
- Indians are not affected by the oil crisis
Oil Crisis Didn’t Affect Indian : In the last two months the world experienced one of the most severe energy crises in decades. The Strait of Hormuz, which carries about 20% of the world’s crude oil and nearly a fifth of its LNG trade, has been threatened by rising tensions in West Asia.
Emergency measures had to be taken
Crude oil prices jumped from around $73 to $126 per barrel in a matter of weeks, an increase of more than 72%. Shipping costs skyrocketed, affecting LNG supply chains and forcing many governments around the world to take emergency measures such as fuel rationing, energy conservation advisories, shorter working weeks and outright fuel price hikes.
The most serious oil supply crisis
World energy experts called this situation the worst oil supply crisis since the Gulf War. It was also warned that a prolonged period of instability in Hormuz could lead to a surge in inflation in economies dependent on energy imports. International reports repeatedly noted that energy import-dependent countries faced the twin challenges of securing supply and protecting consumers from rising inflation.
There were no obstacles in the day-to-day activities in India
Against this backdrop, India’s response has emerged as an important example of resilience and long-term preparedness. Despite being one of the world’s largest oil-importing countries, and with nearly 88% of India’s crude oil imports historically passing through Hormuz, the country kept the daily lives of ordinary consumers almost entirely intact. Petrol and diesel prices remained stable, LPG supply continued uninterrupted and no apparent shortages, rationing or disruptions in day-to-day operations were observed.
India took swift steps
According to industry experts, due to coordinated strategic planning and long-term energy preparedness, India has not allowed global volatility to directly affect domestic consumers. Many economists noted that while many countries passed the burden of rising crude oil prices directly on to consumers, India largely absorbed the stress internally to maintain stability. As the crisis deepened, India took swift action on several levels. Refineries were directed to increase LPG production, leading to a major increase in domestic production. Natural gas supply was prioritized for domestic use, public transport systems and the fertilizer industry, so as not to affect vital sectors.
Important role of government in rate control
At the same time, India increased its imports of crude oil from Russia, America, West Africa and other regions, reducing its dependence on the Gulf. Strategic reserves, refineries running at high capacity and robust fuel distribution system have made it possible to maintain uninterrupted supply in the country even during periods of global market volatility. The government also played an important role in rate control. Excise duties on petrol and diesel were cut, while public sector oil marketing companies bore the brunt of the rise in global crude oil prices. With crude oil prices rising to record highs, companies are said to have absorbed an additional burden of around ₹24 per liter on petrol and around ₹30 on diesel. Therefore, domestic retail fuel prices were kept stable despite the huge price hike in the global market.
India’s approach is special
India’s approach stands out when compared to the reactions of other countries in the world. Bangladesh started fuel rationing. Sri Lanka introduced a four-day work week and a fuel pass system. The Philippines declared a national energy emergency, while South Korea capped fuel prices for the first time in decades. Many countries in Europe had to announce massive subsidy schemes as retail fuel prices rose sharply. India, on the other hand, maintained its composure without allowing any major visible problem to arise.
Energy sector observers believe that the capacity and stability seen today is the result of years of structural investment and policy reforms. Over the past decade, India has expanded LPG infrastructure, doubled the number of import terminals, increased refining capacity, diversified crude oil sources from 27 to 40 countries, accelerated ethanol blending and developed strategic petroleum reserves. According to oil and gas industry analysts, these long-term measures have given India the security it needs to face one of the world’s toughest energy crises today.
Although the crisis is far from over and the government has had to bear a heavy financial burden to protect consumers, one important message is clear from a broader perspective. India has not allowed one of the biggest global oil crises in recent times to become a domestic crisis. Daily life continued as normal for the majority of Indians, a testament to the strength of long-term planning, coordination and investment in the country’s energy system.
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