Amidst the increasing tension in the Middle East and the deepening energy crisis across the world after the war, there is some good news for India. Government sources have said that the energy security of the country is still in a very strong position. India has considerable energy stocks and these stocks are being filled rapidly every day. News agency ANI quoted sources as saying that while there are concerns about crude oil prices across the world, there is no shortage of supply in India right now. LPG and LNG stocks are also sufficient. He also assured that there is no shortage of crude oil in the global market and India is constantly in touch with new suppliers.
Australia and Canada made offers
Government sources said India imports 195 million metric standard cubic meters (MMSCMD) of gas, of which Qatar’s share is only 60 MMSCMD. India has recently signed new contracts with US and UAE. Apart from this, Australia and Canada have made big offers to sell gas to India. India is also looking at other markets to buy gas.
review twice a day
It is also reported that India is talking to big oil producers and traders to buy crude and LPG. It is also talking to the International Energy Agency (IEA) and the Organization of the Petroleum Exporting Countries (OPEC). India is also talking to USA to get ship insurance. The energy situation is being reviewed twice a day.
Why did this crisis happen?
Following US-Israeli attacks, Iran has closed the Strait of Hormuz. This route carries one-fifth of the world’s oil and gas supply and is considered an important checkpoint for the world’s oil supply. According to reports, hundreds of tankers are parked in the strait, a narrow stretch of water between Iran and Oman. This route connects the Persian Gulf to the Gulf of Oman and the Arabian Sea.
What effect does this have on India?
India is not heavily dependent on this route for crude oil. However, it is heavily dependent on this route for LPG and LNG gas. Half of India’s total oil imports (about 2.5-2.7 million barrels per day) come through this route from countries like Iraq, Saudi Arabia, UAE and Kuwait. India lacks structural buffers for LNG and LPG. About 60% of India’s LNG imports come through this route. Spot cargo availability for LPG and LNG is also low, which means that in case of a shortage, the supply cannot be met through other sources or methods.