India's Energy Security and the West Asia Crisis: Strait of Hormuz, Oil Imports, and Diplomatic Balancing
Energy security featured as a central agenda item during the US Secretary of State's bilateral meeting in New Delhi on May 23, 2026.
The US side affirmed that American energy products have the potential to diversify India's energy supply, particularly given the ongoing disruption to oil flows through the Strait of Hormuz since late February 2026.
Iran's selective control over tanker passage through the Strait — a consequence of the Iran-US-Israel conflict that began on February 28, 2026 — has directly affected India's oil and gas procurement, with at least 28 Indian-bound vessels stranded near the strait as of late March 2026.
The Indian crude basket price surged from approximately $69 per barrel in February 2026 to $113 per barrel in March 2026 as a result of supply disruption and elevated procurement costs.
Discussions also covered the broader West Asia crisis, with both sides exchanging assessments on regional stability and the humanitarian situation.
India's Oil Import Dependence and Energy Security Framework
India is the world's third-largest crude oil importer and third-largest energy consumer. It imports approximately 85-87% of its crude oil requirements, making energy security a core dimension of foreign policy and economic stability. The Ministry of Petroleum and Natural Gas, along with the Strategic Petroleum Reserves (SPR) program, forms the institutional backbone of India's energy security architecture.
The Strait of Hormuz disruption has transformed what was a theoretical vulnerability into an active supply crisis for India, making the US offer of energy diversification through American LNG and crude a timely proposition with both economic and strategic dimensions.
The Strait of Hormuz: Geopolitical Significance
The Strait of Hormuz is a narrow waterway (approximately 33 km at its narrowest) connecting the Persian Gulf to the Gulf of Oman and the Arabian Sea. It is the world's most important oil chokepoint, through which approximately 20-21 million barrels per day (bpd) of oil — roughly 20% of global oil consumption — transited in 2023.
Iran's control of the Strait's northern shore gives it structural leverage over Indian energy imports. The disruption since February 2026 has directly elevated the cost and risk of India's energy procurement, making diversification away from Persian Gulf dependence an urgent policy priority.
India's West Asia Policy: Strategic Balancing
India's West Asia policy rests on the "Look West" or "West Asia Policy" doctrine, driven by four core interests: energy imports, diaspora remittances, trade and investment, and counter-terrorism cooperation. India maintains relations with all Gulf states — including Iran — while deepening strategic ties with the US and Israel, requiring careful calibration.
The West Asia crisis discussion between India and the US reflects India's complex positioning — as a US strategic partner seeking energy security cooperation, while simultaneously protecting its traditional equidistance and economic stakes in the Iranian relationship through Chabahar and diaspora welfare in the Gulf.
India's Energy Diversification Strategy
India's energy diplomacy has sought to diversify supply sources to reduce concentration risk. The three pillars of this strategy are: geographic diversification of crude sources, development of domestic renewable energy capacity, and investment in strategic petroleum reserves.
The US Secretary of State's suggestion that US energy can diversify India's supply basket is consistent with India's long-standing diversification policy — and gains operational urgency given the active Strait of Hormuz disruption affecting Indian oil supply chains.
- India imports approximately 85-87% of its crude oil requirements.
- India is the world's third-largest crude oil importer and third-largest energy consumer.
- Strait of Hormuz: approximately 20-21 million bpd of oil transited daily (2023); narrowest point approximately 33 km.
- India's Strategic Petroleum Reserves: approximately 5.33 MMT at three sites, equivalent to roughly 9.5 days of consumption.
- Indian crude basket price: surged from ~$69/barrel (February 2026) to ~$113/barrel (March 2026) due to Hormuz disruption.
- At least 28 Indian-bound vessels stranded near the Strait of Hormuz as of late March 2026, carrying approximately 485 Indian seafarers.
- India's Gulf diaspora: approximately 8.9 million nationals in GCC countries.
- India's total remittance receipts (2023): approximately $125 billion — world's largest.
- India resumed Iranian oil imports in 2026 after a seven-year suspension (2019-2026).
- Chabahar Port Agreement signed: 2016; expanded: 2024.