India Holds Steady on Oil Imports Despite Strait of Hormuz Reopening

The pivot away from Persian Gulf reliance stems from a calculated shift in procurement strategy. Historically, India favored Middle Eastern suppliers for their proximity and pricing, but the recent volatility in tanker traffic exposed the fragility of that dependence. Consequently, refiners pivoted toward Russian oil, bolstered by a Washington-sanctioned waiver that allowed continued trade despite broader restrictions on Russian exporters.

Financial pressures remain acute. Provisional data from the oil ministry reveals that India’s energy import bill surged to $18.7 billion in May, an 81.6% increase compared to the $10.3 billion recorded in May 2025. While crude imports climbed 7.5% and LNG arrivals rose 16% month-on-month, the heavy reliance on non-Middle Eastern sources has kept costs elevated. To mitigate the impact of this supply squeeze, the government has encouraged energy conservation and permitted retailers to implement four fuel price hikes within a single month, marking the first such increases in years.