Parliamentary panel flags risks from India’s oil import dependence, calls for wider sourcing

A parliamentary committee on Thursday warned that India’s heavy dependence on imported crude oil and growing geopolitical risks pose significant challenges to the country’s energy security, and urged the government to diversify supply sources.

In a report tabled in the Lok Sabha, the Public Undertaking Committee noted that India imports nearly 89% of its crude oil requirements, leaving it vulnerable to global disruptions caused by conflicts, sanctions, civil unrest in oil-producing countries and interruptions along key shipping routes such as the Suez Canal and the Red Sea, PTI reported.

“Recent global events, including the Russia-Ukraine conflict and tensions in the Middle East, have underscored the vulnerability of India's energy supply chain and its dependence on international trade flows,” the news agency quoted the report as saying.

The committee recommended that the Ministry of Petroleum and Natural Gas and state-run oil companies intensify efforts to diversify crude sourcing both geographically and contractually, expand strategic petroleum reserves and develop alternative import routes.

It also called for risk management practices, through “improved hedging, revenue diversification and operational efficiency, along with cost optimisation via digital transformation, energy efficiency and overhead rationalisation”.

The report also highlighted internal challenges facing the oil and gas sector, including ageing oil fields, delays and cost overruns in projects, rising land acquisition hurdles and...

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