Beyond Hormuz: Why India Must Urgently Secure Its Energy Lifelines

The early 2026 conflict in West Asia and Iran's subsequent move to assert control over the Strait of Hormuz have transformed a long-standing vulnerability for India into an acute strategic crisis. For a nation that imports over 85% of its crude oil and a significant portion of its Liquefied Natural Gas (LNG), the free passage of energy tankers is not just an economic concern but a cornerstone of national stability.

What makes the Strait of Hormuz so critical?

The Strait of Hormuz is a 21-nautical-mile-wide channel at its narrowest point, separating Iran from Oman. Its strategic importance is rooted in staggering numbers. Approximately one-fifth of global petroleum liquids consumption, translating to about 21 million barrels per day, transited through this chokepoint (Source: U.S. Energy Information Administration, pre-2026 data). For India, the world's third-largest oil consumer and importer, this waterway is its primary energy lifeline. In the fiscal year 2024-25, over 60% of India's crude oil imports and nearly half of its LNG imports passed through the Strait, according to MoPNG data. A June 22, 2026 editorial in The Hindu noted that leveraging control over this waterway can be as potent a weapon as direct economic sanctions, imposing costs far beyond the immediate theatre of conflict.

How has the 2026 conflict altered the strategic landscape?

The key change is the shift from a de facto international waterway, governed by the principle of transit passage under the UN Convention on the Law of the Sea (UNCLOS), to a managed chokepoint. The new framework challenges the rights laid out in UNCLOS Article 38. Following the conflict, Iran established a 'Persian Gulf Strait Authority'. This new framework mandates that all transiting commercial vessels must register with the Authority, pay a 'safe passage' levy, and potentially submit to inspections. Previously, vessels transiting the Strait did not report to or pay tolls to any littoral state. This introduces new layers of political risk and potential delays, directly impacting India's tightly scheduled supply chain, especially for LNG, where the country has insufficient long-term cavern storage and a limited fleet of Indian-flagged carriers to absorb such shocks.

What has been the government's approach to this vulnerability?

The Government of India's strategy has historically rested on three pillars: diversification of supply, building strategic reserves, and diplomatic engagement. On diversification, India has made concerted efforts to reduce its over-reliance on West Asian crude, increasing offtake from the United States and Russia. For instance, Russia's share in India's oil import basket surged from under 2% before 2022 to over 35% by mid-2023 (Source: Ministry of Commerce and Industry data). The second pillar is the Indian Strategic Petroleum Reserves (ISPRs). The existing 5.33 MMT (approx. 39 million barrels) capacity provides a buffer of approximately 9.5 days of national net import requirements. The government, in its Union Budget for 2021-22, had announced the establishment of two additional commercial-cum-strategic reserves in Chandikhol (4 MMT) and Padur (2.5 MMT) under a Public-Private Partnership (PPP) model, though as of early 2026, final investment decisions were still pending. The third pillar, diplomatic outreach, involves projects like the development of the Chabahar port in Iran, intended to provide an alternative route to Central Asia.

What are the limitations and criticisms of India's strategy?

Analysts point to a significant gap between strategy and implementation. The primary criticism is that the scale of India's strategic reserves is inadequate. The International Energy Agency (IEA), of which India is an associate member, recommends its members hold emergency oil stocks equivalent to 90 days of net imports. India's government-held reserves of 9.5 days, combined with stocks held by oil marketing companies (around 65 days), fall short of this benchmark and are vulnerable to supply chain disruptions. The 2024 report of the Parliamentary Standing Committee on Petroleum and Natural Gas had already flagged the slow progress on Phase-II SPRs as a critical gap in national preparedness. Furthermore, the LNG and LPG strategy is seen as particularly fragile due to a lack of dedicated strategic storage. The progress on alternative routes has also been halting, with the Chabahar project hampered by geopolitical complexities, as noted by strategic affairs analyst C. Raja Mohan.

How are other nations addressing similar dependencies?

Other major energy players have pursued more aggressive de-risking strategies. The United Arab Emirates (UAE), an exporter, has actively pursued a 'zero Hormuz dependency' strategy. The cornerstone of this is the Abu Dhabi Crude Oil Pipeline, which runs 370 km from Habshan to the port of Fujairah on the Gulf of Oman, completely bypassing the Strait. This pipeline has a capacity to transport 1.5 million barrels per day, roughly 50% of the UAE's export capacity (Source: ADNOC). Similarly, Saudi Arabia operates the East-West Pipeline to its Red Sea ports. Among importers, China has invested in a 'string of pearls' strategy, developing ports and pipelines like the Gwadar port in Pakistan and energy corridors through Myanmar to create multiple supply routes. These examples highlight a proactive approach to building physical infrastructure that provides genuine alternatives to contested chokepoints.