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Informist, Monday, May 11, 2026

 

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--Oil secy: India diversified import sources rapidly post West Asia war 
--CONTEXT: Oil secy Mittal speaking at CII Annual Business Summit 2026 
--Oil secy: Have maintained 1.5 months of LPG stock for last 70 days 
--Oil secy: Currently maintaining 60 days' stock for crude 
--Oil secy: Need to conserve energy, save forex reserves 
--Oil secy: Working on increasing crude oil production in medium-to-long term 
--Oil secy: Adopting creative strategies to up crude oil production 
--Oil secy: Working on programmes to enhance crude oil exploration 
--Oil secy: Have to look at creative ways to maintain strategic reserves 
--Oil secy: India a relative oasis of calm movement in retail fuel prices 
--Oil secy: See no shortage of investment for crude oil exploration 
--Oil secy: Excise duty cut to create around INR 1.6 tln hole in FY27 Budget 
--Oil secy: Govt must step in for high-risk crude exploration plan 
--Oil secy: Looking to increase ethanol's use in transport sector 
--Oil India CMD: Global cos showing interest in oil exploration activities 
--CONTEXT: Oil India CMD Rath speaking at CII Summit in New Delhi 
--Oil India CMD: Need big discovery to up oil exploration 
--Oil India CMD: Cannot reduce dependence on crude oil imports 

 

 

NEW DELHI – Amidst the energy price and supply shock caused by the war in West Asia, India is increasing its crude oil production and exploration, Oil Secretary Neeraj Mittal said Monday. The government is looking at creative strategies to raise crude oil production and also working on programmes to enhance crude oil exploration, Mittal said at the Confederation of Indian Industry's Annual Business Summit.

 

To meet domestic fuel requirement, India imports more than 87% of its crude oil requirement, which significantly pushes up the country's import bill. As India faces one of the worst energy crises in decades following the outbreak of war in West Asia, the country's domestic capacity expansion will help it to save its foreign exchange reserves, Mittal said.

 

India has been exposed to energy supply and price shocks, given its dependence on countries in the Persian Gulf region for crude oil, liquefied petroleum gas, and liquefied natural gas supplies. Crude oil prices have soared around 60% following the closure of the Strait of Hormuz since early March. Nearly half of India's crude oil and natural gas imports pass through this crucial waterway. The supply shock has led to a surge in fuel prices in several developing and advanced economies, but retail prices in India have remained unchanged.

 

Since the war started Feb. 28, the rupee has also seen significant volatility, falling 4.5% against the dollar, hitting a new lifetime low of 95.435 Tuesday. With no end to the war in sight, market participants expect the rupee to continue to fall as India is the world's third-largest oil importer. India's oil imports were at $174 billion in the financial year 2025-26 (Apr-Mar), compared with $186 billion in FY25. India's foreign exchange reserves were at $690.69 billion as of May 1, almost $38 billion lower from the record high just before the war started.

 

According to Mittal, there is no dearth of investments flowing into India's oil production and exploration activities, but the government must also continue investing in the high-risk sector. Oil India Ltd. Chairman and Managing Director Ranjit Rath, who was also present at the event, said global companies are showing interest to invest in India's exploration endeavours.

 

Rath said that while India's oil import bill is very high, dependence on imports cannot be reduced unless India's exploration activities go up meaningfully. To support this, a "big discovery" needs to be made in exploration, he said. Mittal also said India is trying to use advanced data to tap the unexplored sedimentary basins. In July 2024, Petroleum Minister Hardeep Singh Puri had said India has investment opportunities worth $100 billion by 2030 for oil and gas exploration.

 

Speaking about India's oil reserves, Mittal said the country must also look at creative ways to maintain its strategic reserves. Despite the severe fuel crunch, the oil secretary said, India maintains 60 days' stock for crude oil and one and a half month's stock for LPG.

 

This stock has been built on the back of strategic and fiscal support from the government, coupled with state-owned oil marketing companies bearing the brunt of the supply and price shock. The government has already taken a slew of measures to mitigate the impact of the war, including cutting excise duty on petrol to INR 3 per litre from INR 13 per litre and on diesel to zero from INR 10 per litre to help the oil marketing companies absorb the rise in crude oil prices. The government's total revenue loss could be over INR 1.60 trillion, Mittal said.

 

These have ensured "India is (a) relative oasis of calm" amid the volatility in retail prices of fuel, Mittal said. To continue to maintain this support, consumption-side sensitivity must also be showed, he said. The government is also increasing the percentage of ethanol used in transport fuel to cut down diesel and petrol usage, the secretary said.

 

His comments come a day after Prime Minister Narendra Modi urged Indians to increasingly use metro rail, railways, and public transport to cut down on consumption of petrol and diesel. Besides, India has already championed "work from home" during the COVID-19 pandemic, and it is time video-conferencing, online meetings, and other such technologies are popularised to cut down on travel, he had said.  End

 

Reported by Priyasmita Dutta, Shubham Rana, Shakshi Jain, and Astha Oriel

Edited by Rajeev Pai

 

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