Indian refiners seek alternative crude supplies as Hormuz operations stall
What's the story
As the conflict in West Asia continues, Indian refiners are looking for alternative sources of crude oil. They are negotiating additional shipments from the US, Russia, and West Africa to ensure adequate supply. This comes after military action by the US and Israel against Iran has led to a near-complete halt of tanker traffic through the strategic Strait of Hormuz.
Operational changes
Indian refiners postpone planned maintenance shutdowns
Indian refiners, who convert crude oil into fuels like petrol and diesel, have postponed planned maintenance shutdowns and are running at normal processing rates. This is to create buffers that could meet the country's near-term requirement. India imports around 88% of its crude oil needs, with nearly half of these supplies in February passing through the Strait of Hormuz.
Supply diversification
Increase in non-strait sources for crude oil
The ongoing conflict has led to a significant increase in the importance of non-strait sources for crude oil. These now account for 70% of supplies, up from 60% in 2025. Indian refiners are sourcing crude from West Africa, Latin America, and the US. A recent waiver by the US Treasury Department allowing sale and delivery of sanctioned Russian oil to India has opened another avenue for supply.
Market return
Return to Russian market
After the US imposed sanctions on Russia's leading oil producers Rosneft and Lukoil in October 2025, Reliance Industries, Hindustan Petroleum Corporation Ltd., and HPCL-Mittal Energy Ltd. had stopped buying Russian crude. However, they have now returned to the market to secure Russian cargoes. The Oil Ministry official said India never stopped buying Russian oil and that combined inventory can meet country's demand for 50 days.
Reserve details
Strategic Petroleum Reserves and potential challenges
India's Strategic Petroleum Reserves can cover around 9.5 days of net oil imports. State-run oil companies have storage for crude and petroleum products equivalent to 64.5 days of net imports, taking the total storage capacity to about 74 days of net imports, according to Petroleum Ministry data. However, analysts warn that while India may secure adequate physical crude through alternative sources, the overall cost structure could worsen due to higher prices and longer shipping routes.