If Iran closes the Strait of Hormuz, the rest of the world might panic—but India, surprisingly, may not flinch. With an increasingly diversified energy basket, steady oil prices, and heavy Russian inflows, New Delhi seems unusually well-braced for one of the most volatile flashpoints in global trade.
Iran’s war drums are growing louder, and so are the fears. After U.S. strikes on Iranian nuclear facilities, Tehran is threatening to shut down the Strait of Hormuz—a 21-mile-wide sliver of water through which a fifth of the world’s oil flows. But even as global oil prices creep up, India, the world’s third-largest crude importer, appears unusually insulated from the fallout.
How India Quietly Prepared for a Storm
This wasn’t luck. India saw it coming.
In recent years, particularly after Russia’s invasion of Ukraine in 2022, India made some bold energy moves. It turned to Russia—and hasn’t looked back.
Officials in the oil ministry say New Delhi has been buying record volumes of Russian crude, which bypasses Middle Eastern transit routes altogether. In June, Indian refiners bought more oil from Russia than they did from Saudi Arabia and Iraq combined, according to Kpler, a global commodity data analytics firm.
The shift didn’t just happen overnight. It was calculated.
India’s foreign policy, especially in energy, has been pivoting toward supplier flexibility for a while. And now, that bet is paying off.
What Happens If Iran Closes Hormuz?
The risk isn’t hypothetical anymore.
Iran’s parliament has greenlit a potential closure of the Strait of Hormuz, a strategic waterway between Iran and Oman. It’s the route through which tankers from Saudi Arabia, Iraq, UAE, Kuwait—and even LNG exports from Qatar—sail out.
India imports nearly 90% of its oil needs. About 40% of that travels through the Strait. You’d think a closure would hit like a freight train.
But here’s the twist—it probably won’t.
Why? Because much of India’s current oil stock is coming from places that don’t need Hormuz. Think Russia, the U.S., and even Brazil. So, while the strait is undeniably important, India isn’t putting all its barrels in one basket anymore.
Energy Ministry Tries to Calm the Nerves
As tensions flared over the weekend, India’s petroleum ministry held meetings with major refiners.
Their message was clear: “The situation is manageable.”
Officials told reporters that current stockpiles are solid, LNG imports are diversified, and no panic is necessary—at least for now.
In fact, oil prices, while spiking briefly, haven’t gone haywire.
• Brent crude touched $81.40 per barrel on Monday, a five-month high, but hasn’t surged beyond control
• West Texas Intermediate (WTI) followed at $78.40
Both increases were sharp but still within the comfort zone for India’s economy.
Just How Much Oil Is at Stake?
Let’s take a quick look at the numbers—because they paint the real picture.
| Source Country | June 2025 Import Share (%) | Hormuz Dependency |
|---|---|---|
| Russia | 42% | No |
| Saudi Arabia | 16% | Yes |
| Iraq | 12% | Yes |
| UAE | 8% | Yes |
| US | 7% | No |
| Brazil | 5% | No |
| Others | 10% | Mixed |
Only about 36% of imports in June were directly dependent on Hormuz—a notable drop from the usual 45–50% figure seen in previous years.
LNG and Gas? There’s a Bit More Vulnerability
While crude has diversified, India’s gas game isn’t quite as flexible.
Roughly half of India’s LNG imports come through Hormuz—especially from Qatar. If the strait shuts, some pinch is likely.
But even here, officials say buffer stocks are ready, and additional supplies from Australia and Africa could be routed if needed.
One official summed it up: “We won’t run out of gas. At worst, we might pay a bit more for a while.”
Still, a prolonged closure would be tricky. Unlike crude, LNG logistics are more rigid.
The Russia Factor Just Keeps Growing
Russia has quickly become India’s energy lifeline.
Since Western sanctions pushed Moscow out of European markets, it’s turned east—with India as a key buyer. And Moscow has offered big discounts, making the crude not just abundant but also cheap.
A senior oil analyst with S&P Global said that Russian oil now accounts for over 40% of Indian imports—up from less than 2% in 2021.
“Russia has done for India what Middle Eastern suppliers took decades to build,” he added. “That’s strategic leverage.”
This isn’t just about volume, though. It’s also about politics. Moscow isn’t threatening tankers. It’s not in the Hormuz mess. And it isn’t squeezed by Iran-Israel tensions.
Could Global Shockwaves Still Hit?
Of course, India isn’t living on an island.
If oil spikes globally, so do Indian prices. Even if its imports aren’t directly disrupted, insurance premiums on tankers, higher freight rates, and a nervous market could push fuel prices higher at home.
But as of now, refiners say they’ve got enough crude to keep the taps running.
And fuel prices? They’ve barely budged this week.
That’s a sharp contrast to 2019, when just the threat of Hormuz tension sent Indian petrol prices soaring within days.
Political Messaging and Global Optics
There’s also an international side to this.
By staying calm, India is signaling reliability—to markets and to allies. While Europe scrambles, and the U.S. tightens advisories for its citizens across the Middle East, New Delhi is projecting control.
That doesn’t mean India isn’t watching closely. The situation is fluid. Another missile, another strike, another closure—and the script could flip.
And in the middle of a global oil panic, that’s saying something.
