Emergency fuel supply measures to be rolled back once govt feels confident of West Asia supply stability

4 min readJun 18, 2026 07:36 PM IST

India is among the top importers of crude oil, LNG, and LPG. (File Photo)

With the US-Iran MoU raising hopes of normalisation of energy flows through the Strait of Hormuz, emergency measures taken since early March to ensure adequate fuel supply security to the most critical sectors and consumer segments are now likely to be reviewed and rolled back once the government feels the situation is stable and nearing normalcy, according to a senior government official.

The West Asia war, which broke out on February 28 with the US and Israel striking Iran, led to an effective halt in vessel movements through the critical chokepoint of the Strait of Hormuz, which accounted for a fifth of global oil and liquefied natural gas flows. The strait is a narrow waterway that connects the Persian Gulf with the Gulf of Oman and the Arabian Sea, and is the primary route to evacuate energy supplies from the broader Gulf region.

Given the supply squeeze, the government announced several measures, which included prioritising natural gas supply to some priority sectors while reducing it for others, reducing liquefied petroleum gas (LPG) allocation for commercial and industrial consumers to ensure cooking gas availability to households, increasing mandatory waiting periods of LPG refills by households, and measures to prevent hoarding of petrol and diesel.

“We have been reviewing the situation on a daily basis…all the measures we took during this crisis period will be reviewed and once we feel confident that the situation has normalised, we will start rolling those back,” the government official said.

“To ensure supplies to some priority segments, we were forced to curtail supply to some other sectors. We want to resume supplies at regular levels to those sectors as well, and it will be done once things normalise,” the official added.

Around 40% of India’s crude oil imports, 60% of its LNG imports, and a whopping 90% of its LPG imports regularly came from West Asia through the Strait of Hormuz. The country’s dependence on imports stands at over 88% for oil, 60% for LPG, and about 50% for natural gas, which is imported as LNG. India is among the top importers of crude oil, LNG, and LPG.

While highly diversified crude sourcing helped ensure adequate oil, petrol, diesel, and jet fuel availability in the country, the government was forced to ration gas supplies to certain industries and commercial consumers. Moreover, the surge in international prices forced India to import oil and gas at extremely high rates, as the country had to prioritise supply security over price considerations.

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With maritime traffic through the Strait of Hormuz now widely expected to pick up following the US-Iran initial peace agreement, huge volumes of oil and gas stranded in the Persian Gulf could hit the international market in the coming months, which is likely to cover the shortfall in global supply and even lead to a glut a few months down the line if regular oil and gas exports from the region resume. Given that supplies are likely to be more than adequate in the coming months, unless the peace agreement fails, there would be no reason for the government to continue with the emergency measures, industry sources said.

“A reopening of the Strait of Hormuz would represent a major milestone for global energy markets, but the impact on India is likely to vary significantly across commodities. While India remains one of the largest importers of Middle Eastern hydrocarbons, crude and LNG imports have proven relatively resilient throughout the disruption, unlike LPG…As a result, the recovery is likely to be sequential, with LPG flows normalising first, followed by LNG and crude,” said said Sumit Ritolia, manager, modelling & refining at commodity market analytics firm Kpler.

Sukalp Sharma is a Deputy Associate Editor with The Indian Express and writes on a host of subjects and sectors, notably energy and aviation. He has over 16 years of experience in journalism with a body of work spanning areas like politics, development, equity markets, corporates, trade, and economic policy. He considers himself an above-average photographer, which goes well with his love for travel. ... Read More

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