Fossil fuel import bills surge over $330 billion in six months since Hormuz crisis: CREA
An energy research organisation's report finds fossil fuel importing countries paid over $330 billion in additional costs in the six months following the Hormuz crisis that began in late February 2026 — about $55 billion a month
The report characterises this as the largest sustained energy cost shock since the 1990 Gulf War
China paid the most in additional costs ($35.5 billion), followed by India ($22.5 billion) and the United States ($16.5 billion)
Of 170 countries analysed, low- and lower-middle-income countries bore a disproportionately higher burden relative to GDP than high-income countries
The analysis also finds that clean energy capacity added globally since 2020 helped avoid an estimated $36 billion in additional costs during the crisis period
CREA — Independent Energy and Air Quality Research Body
The Centre for Research on Energy and Clean Air (CREA) is the organisation behind this analysis. Understanding who compiles such data — and their methodology — matters for evaluating the reliability of the figures cited in current affairs.
Key Details
- CREA is an independent, non-profit think tank founded in Helsinki, Finland, in 2019
- It focuses on tracking trends, causes, and health impacts of air pollution and energy transitions, and supports governments, companies, and campaign groups with data-backed research
- For this analysis, CREA compared actual seaborne fuel prices (March-August 2026) against pre-crisis futures contracts from the 12 trading days before the disruption began, across 170 countries, excluding pipeline gas and coal
The $330 billion figure is a modelled estimate of the gap between actual and counterfactual fuel costs, not a direct government-reported expenditure, which is an important distinction for interpreting such headline numbers.
India's Oil Import Dependency and the Current Account Deficit
Crude oil is consistently the largest single item in India's merchandise import bill, which is why global oil price shocks translate quickly into India's trade and current account numbers.
Key Details
- India imports roughly 85% of its crude oil requirement, making it structurally exposed to exporter-region disruptions such as the Hormuz crisis
- A sustained rise in the oil import bill widens the trade deficit and, through it, the Current Account Deficit (CAD), typically also pressuring the rupee's exchange rate
- India's Strategic Petroleum Reserves (ISPRL), with 5.33 MMT of capacity at Visakhapatnam, Mangalore, and Padur, provide a short-term buffer (currently around 9-10 days of cover) but are not designed to absorb a prolonged price shock of this scale
- The RBI's monetary policy framework tracks CPI inflation, in which fuel and transport costs are a component, meaning oil shocks also feed into headline inflation readings the Monetary Policy Committee must respond to
India's $22.5 billion additional cost places it second only to China among fossil-fuel importers, directly linking a West Asian supply disruption to India's macroeconomic indicators.
National Green Hydrogen Mission — Insulating Against Fossil Fuel Price Shocks
India's clean-energy programmes are a direct policy response to the structural vulnerability that events like the Hormuz crisis expose: dependence on imported, price-volatile fossil fuels.
Key Details
- Approved by the Union Cabinet in January 2023 with an outlay of ₹19,744 crore
- Targets green hydrogen production capacity of 5 Million Metric Tonnes (MMT) per annum by 2030, supported by roughly 125 GW of additional renewable energy capacity
- Aims to make India a global hub for green hydrogen production, usage, and export, and projects investments exceeding ₹8 lakh crore
- Expected to avert nearly 50 MMT of CO2 emissions annually once at scale
The report's finding that clean energy capacity added since 2020 already saved $36 billion globally during the crisis provides an empirical case for missions like this one, which reduce exposure to future fossil-fuel supply shocks.
- Additional global fossil fuel cost since the Hormuz crisis: over $330 billion in six months (~$55 billion/month)
- Crude oil: +$164 billion additional cost (prices ~35% above pre-crisis expectations)
- Diesel/gasoil: +59% price rise, +$74 billion; Gasoline: +43%, +$36 billion; LNG: +60-75%, +$38 billion; Jet fuel: +59%, +$20 billion
- Top-paying countries: China ($35.5 billion), India ($22.5 billion), United States ($16.5 billion)
- Low/lower-middle-income countries bore ~1% of 2024 GDP in added costs versus ~0.45% for high-income countries
- Clean energy capacity added since 2020 saved an estimated $36 billion during the crisis
- India's crude oil import dependency: approximately 85%
- National Green Hydrogen Mission target: 5 MMT/year green hydrogen by 2030, outlay ₹19,744 crore