The Gulf War between the United States, Israel, and Iran has shaken global energy security. The conflict has had the greatest impact on the Strait of Hormuz—the narrow seaway through which approximately 20% of the world’s oil and liquefied natural gas (LNG) passes. This passage has been virtually paralyzed due to the war, which is why it is frequently mentioned in the news these days.
According to the International Energy Agency (IEA), this has become the largest energy supply disruption in modern history. Oil and gas production in the Gulf region has declined by approximately 10 million barrels per day. Iran’s attacks have damaged energy facilities in several Gulf countries. The result is clear: oil prices have reached $100 to $120 per barrel. This has increased inflationary pressures worldwide and is placing a heavy burden on economies.
How is it impacting the world?
Europe and Asia are bearing the brunt of this crisis, as these regions import approximately 90 percent of their energy through this route. The Strait of Hormuz has virtually closed, reducing the movement of oil tankers by approximately 98 percent.
This has also directly impacted the gas market. Disruptions in supplies from major LNG exporters like Qatar have led to a 45 percent increase in gas prices in Europe. Fuel prices in developing countries are increasing food prices and industrial costs.
Production halts in major Gulf producers—Saudi Arabia, the United Arab Emirates, and Iraq—have exacerbated delays and uncertainty in global supply chains. This crisis also highlights a larger truth: the world economy remains heavily dependent on fossil fuels (coal, oil, and gas). This dependence rests on tiny “chokepoints” that could trigger a crisis at any time.
What will be the impact on India?
India’s situation is also not easy. The country imports 85–90% of its crude oil needs. Of this, approximately 45–50% (approximately 2.5–2.7 million barrels daily) comes from the Gulf, via the Strait of Hormuz.
Not only this—approximately 90% of India’s LPG and a large portion of LNG also come from this region. If supplies remain disrupted for a prolonged period, the country could face the risk of a fuel shortage.
India has limited reserves in its strategic petroleum reserves. The rising oil prices will increase inflation, put pressure on the rupee, and increase the burden on the government budget.
This is already affecting everyday life. Air travel is becoming more expensive, transportation costs are rising, and even small hotels, restaurants, and restaurants across the country are being affected.
What steps has India taken?
However, amid the crisis, India has also taken some prudent steps—it increased oil imports from Russia by nearly 40%. Additionally, it purchased approximately 30 million barrels of oil from the spot market (where immediate purchases and sales occur).
What is the way forward?
The most important step in the short term is to diversify import sources. India and the world will need to import more oil and gas from regions like the United States, Nigeria, and South America.
But the real solution lies in the long term—clean energy. India has set a target of achieving 500 gigawatts of renewable energy capacity by 2030. This includes expanding solar and wind power projects and electric vehicles to reduce dependence on oil.
Also, expanding nuclear power and increasing domestic gas production in the KG Basin are also key initiatives. All these steps can strengthen energy security.
This Gulf War sends a clear message: global energy security is extremely fragile. If the entire system remains dependent on a few narrow sea lanes, such crises will continue to recur.
The lesson for India is the same: move rapidly towards energy self-sufficiency. Diversified imports, large reserves, and investment in green energy are the way forward.
If the right decisions are made, this crisis can become not just a threat but also an opportunity—an opportunity to build an energy system that is stronger, safer, and more independent.
