Page 44 - Policy Economic Report - March 2026

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

in a week. Another neighbour has closed universities early and brought forward the Eid-al-Fitr holiday to
save fuel. Countries in SE Asia also have had to take energy rationing and conservation measures.

CRUDE and PETROL, DIESEL:

3. India’s crude supply position is secure, and volumes secured exceed what Hormuz would have
delivered. Before this crisis, approximately 45 per cent of India’s crude imports transited the Hormuz
route. Thanks to Hon’ble PM’s outstanding diplomatic outreach and goodwill, India has secured crude
volumes that exceed what the disrupted Strait route would have delivered in the same period. Non-
Hormuz sourcing has risen to approximately 70 per cent of crude imports, up from 55 per cent before
the conflict began. India sources crude from 40 countries, against 27 in 2006-07; this structural
diversification, built through sustained policy over successive years, has given us options that other
nations now find themselves without. Refineries are operating at high capacity utilisation; in several
cases, they are exceeding 100 per cent.

4. There is no shortage of petrol, diesel, kerosene, ATF or fuel oil. The availability of petrol, diesel,
aviation turbine fuel, kerosene, and fuel oil is fully assured. Retail outlets across the country are stocked
and supply chains for these products are functioning normally. Additional allocation of PDS Kerosene has
been issued to all the States.

NATURAL GAS:

5. Natural gas supply has been managed through prioritised allocation, and the position is stable well
beyond immediate need. India produces approximately 90 MMSCMD (Million Metric Standard Cubic
Metres per Day) of natural gas domestically. A further 30 MMSCMD was previously imported through
Gulf sources now affected by the force majeure declaration from a major Qatari processing facility. The
Natural Gas Control Order issued on 9 March 2026 under the Essential Commodities Act established an
immediate priority sequence. Domestic piped gas to homes and CNG for vehicles receive 100 per cent
supply with no cuts. Industrial and manufacturing consumers will receive upto 80 per cent of their
previous six-month average. Fertiliser plants will receive upto 70 per cent, protecting the agricultural
input chain ahead of the sowing season. Refineries and petrochemical units absorb a managed
reduction, with that gas redirected to higher-priority sectors. I am pleased to inform the House that the
shortfall has been substantially offset through alternative procurement. Large LNG cargoes are arriving
on an almost daily basis through alternative supply routes, and India has sufficient gas production and
supply arrangements to sustain this position even in the event of a prolonged conflict. Power generation
for every household and for industry is fully protected.

LPG:

6. It should be noted that India was previously importing approximately 60 per cent of its LPG
requirements from Gulf countries such as Qatar, UAE, Saudi Arabia, and Kuwait and 40 per cent is
produced domestically. Procurement has now been actively diversified, with cargoes being secured from
the United States, Norway, Canada, Algeria, and Russia, in addition to available Gulf sources.

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