India's Fossil Fuel Supply: 85% of Crude from 6 Nations, 9-Day Stockpile

For supply chain strategists, India's energy insecurity is a strategic blind spot. A new CEEW analysis reveals that 85% of crude oil imports come from a handful of countries, sending ripple effects through logistics, procurement, and manufacturing costs whenever geopolitical tensions or shipping disruptions arise. With only 9 days of strategic petroleum reserves, the margin for error is virtually nonexistent.

India's energy security landscape has fundamentally shifted from a narrow concern over import dependence to a multifaceted economic threat, according to a landmark study by the Council on Energy, Environment and Water (CEEW). Released on June 17, 2026, the report 'How Secure is India's Energy Future? Assessing Accessibility, Reliability, and Affordability' details how concentrated suppliers, vulnerable shipping lanes, insufficient storage, refinery bottlenecks, and exposure to global price volatility coalesce into a systemic risk that could destabilize the country's inflation, industrial competitiveness, public finances, and strategic autonomy.

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In 2024, India imported 88% of its crude oil, nearly 48% of its natural gas, and about 26% of its coal.

The numbers underscore the scale of exposure. In 2024, India imported 88% of its crude oil, nearly 48% of its natural gas, and about 26% of its coal. Fossil fuels devoured more than 28% of India's total import bill in fiscal 2024-25, a massive drain on foreign exchange that leaves the economy hostage to international price swings. The supply chain is dangerously concentrated: over 85% of crude oil imports flow from just six countries, including Russia and West Asian producers. This tight geographic sourcing affords little room to maneuver if any single supplier faces disruption, whether from sanctions, conflict, or production outages.

Even more alarming is the lack of a buffer. India's strategic petroleum reserves cover a mere 9-10 days of net crude imports, far below the 90-day stockpile maintained by many IEA member countries. This razor-thin cushion means any interruption in shipping—be it from a chokepoint closure in the Strait of Hormuz, a Suez Canal incident, or piracy—could rapidly escalate into domestic fuel shortages, price spikes, and industrial slowdowns. Refinery constraints compound the problem, as limited domestic processing capacity for heavier or sourer crude grades restricts supply-diversification options when lighter sweet grades become scarce.

The cascading economic effects are profound. Hemant Mallya, Fellow at CEEW, warned that "disruptions in crude oil, LNG, LPG, coal, or key shipping routes can quickly affect cooking costs, transport fuel prices, fertiliser subsidies, industrial competitiveness, and inflation." Indeed, rising energy costs directly feed into headline inflation, eroding household purchasing power and forcing central bank tightening that chokes credit for businesses. Fertiliser subsidies, already a significant fiscal burden, would swell with higher natural gas feedstock prices, further straining public budgets. For industries ranging from petrochemicals to steel, higher energy inputs erode margins and export competitiveness against peers in regions with more secure and cheaper energy supplies.

The study also highlights a shift in the energy-security paradigm itself—from a binary import-dependence metric to a dynamic assessment of accessibility, reliability, and affordability. India has made strides in expanding energy access and scaling renewables, but the fossil fuel backbone remains riddled with structural frailties. The reliance on imported LNG, for instance, exposes the power and fertilizer sectors to spot-market volatility, while coal import dependency, though lower, still subjects the steel and power sectors to international price and shipping disruptions.