International crude oil prices surged on Monday with the escalating conflict in the Middle East also putting Indian energy markets and oil companies on edge. Experts warn that sustained disruptions will keep prices elevated and tighten LNG availability, underscoring the urgent need for strategic planning to protect India’s energy security.
According to Sehul Bhatt, Director of Crisil Intelligence, developments in the Middle East have significantly increased pricing and procurement risks for crude oil and liquefied natural gas (LNG). This poses a critical challenge for India, which relies on imports for over 85% of its crude oil and 50% of its LNG requirements. Given the critical role of energy across sectors, Bhatt noted that corporate India is now exposed to three primary risks.
Given the critical role of energy across sectors, corporate India will be exposed to three major risks, he says.
“First, crude oil prices have jumped above $75 per barrel in the past two days. If geopolitical issues ease, we expect prices to average $65–70 in CY2026, but prolonged conflict could push prices even higher.
“Second, while Iran supplies 4.5–5% of global oil, the main concern is disruption at the Strait of Hormuz which is vital for almost half of India’s imports of both these commodities, thus increasing vulnerability. If disruptions persist, shipments may be rerouted via the Cape of Good Hope, lengthening transit times and increasing the cost along with rising freight and insurance premiums.
“Third, OPEC+ paused output hikes for Q1 2026 but plans a modest increase of ~0.2 mbpd from April, which could offer some relief. However, spare capacity outside Saudi Arabia and the UAE is limited, so the price impact will depend on actual oil flows through the Gulf. This concentration limits short-term supply flexibility,” according to Bhatt,