Representative AI image
India on Saturday reviewed its crude oil and fuel supply position amid escalating geopolitical tensions in the Middle East, with the government asserting that it is closely monitoring developments to safeguard domestic availability.“In view of ongoing geopolitical developments in the Middle East, the Minister of Petroleum & Natural Gas reviewed the supply situation for crude oil, LPG, and other petroleum products with senior officials from the Ministry and PSUs,” said the ministry in a statement on X.
Further assuring measures to keep supply stable it added, “We are continuously monitoring the evolving situation and all steps will be taken in order to ensure availability and affordability of major petroleum products in the country.”India relies on imports for more than 85 per cent of its crude oil needs, with a substantial portion coming from West Asia. According to industry estimates, cited by ET, every $1 rise in global crude prices increases India’s annual import bill by about $2 billion, exerting pressure on inflation, widening the current account deficit and complicating domestic fuel pricing dynamics.Crude oil is a key raw material in a wide range of everyday consumer goods, including detergents, biscuits, toothpaste, paints and packaging materials. Petroleum-based derivatives are extensively used in products such as soaps, shampoos, creams, hair oils, plastic bottles and tubes. These inputs account for over 25 per cent of production costs for FMCG companies and nearly 40 per cent for paint manufacturers. As a result, any sustained rise in crude prices could translate into higher costs for these daily-use items.Oil supply troubles further escalted as Qatar’s state-run energy major halted liquefied natural gas (LNG) production following Iranian drone attacks on key industrial facilities, triggering a sharp spike in European gas prices. Saudi Arabia, meanwhile, said it had temporarily shut down certain units at the Ras Tanura oil refinery in its eastern region after a fire broke out in the aftermath of a separate drone strike.In a statement issued on Monday, QatarEnergy said it had suspended LNG and related output due to military attacks on its operating facilities in Ras Laffan Industrial City and Mesaieed Industrial City. The company, the world’s largest LNG producer, cited security concerns following the strikes. ““Due to military attacks on QatarEnergy’s operating facilities in Ras Laffan Industrial City and Mesaieed Industrial City in the State of Qatar, QatarEnergy has ceased production of liquefied natural gas (LNG) and associated products,” it said, as quoted by Al Jazeera.Earlier in the day, Qatar’s Defence Ministry said two drones launched from Iran had targeted infrastructure in the country. One drone struck a water tank linked to a power plant in Mesaieed, while the other hit an energy facility in Ras Laffan Industrial City operated by QatarEnergy. Authorities said there were no reported casualties.The disruption had an immediate impact on global markets. European natural gas prices surged by nearly 50 per cent shortly after the announcement, reflecting fears of prolonged supply constraints from one of the world’s most critical LNG exporters.