India’s Energy Diplomacy Passes Its Toughest Test As Hormuz Crisis Exposes Risks, Spurs Coordinated Global Supply Diversification

Maritime choke points have long threatened global energy security, yet history suggests they rarely close completely. The Suez Canal blockage in 2021 disrupted global trade but spared oil flows. The Red Sea crisis exposed vulnerabilities around the Bab el-Mandeb. The Strait of Hormuz, however, occupies a different strategic league. For India, it remains the country's single most important energy gateway.

Nearly 40% of India’s crude oil, 60% of its liquefied natural gas (LNG), 92% of its LPG and more than 70% of its urea imports transit this narrow passage. Despite wars, sanctions and repeated regional tensions, Hormuz had remained open for decades.

Its closure on 28 February therefore represented an unprecedented challenge to India's energy security. The immediate concern extended well beyond crude oil. LPG fuels the kitchens of over 333 million Indian households, while LNG powers industry and fertiliser production. A prolonged disruption would have threatened both energy supplies and food security.

India’s response demonstrated the strength of coordinated statecraft. Within days, an Inter-Ministerial Group brought together key ministries in a whole-of-government effort. Crude sourcing was diversified across nearly 40 countries, while alternative LNG and LPG supplies were secured from the US, Norway, Canada and Algeria, substantially reducing dependence on Gulf shipments. The most significant achievement, however, was maintaining essential shipping through the Strait itself. Close coordination between the Ministry of Petroleum and Natural Gas, the Ministry of External Affairs, Indian refiners and the Indian Navy ensured priority cargoes continued reaching Indian ports. Sustained engagement with Tehran, Gulf partners and leading energy suppliers preserved critical supply chains during one of the most testing periods for global energy markets.

The subsequent easing of tensions and gradual reopening of the Strait have lowered freight and insurance costs, softened crude prices and eased pressure on India's import bill. Yet the episode carries lessons that extend well beyond the crisis itself.

Diversified supply chains, stronger strategic petroleum reserves and deeper international energy partnerships must now become enduring national priorities. For one of the world's largest energy consumers, resilience cannot depend solely on favourable geopolitics or uninterrupted sea lanes. The Hormuz crisis demonstrated that effective diplomacy, backed by institutional coordination and operational preparedness, can safeguard national interests under extraordinary pressure.

The challenge now is to convert the resilience forged in crisis into a permanent pillar of India's long-term energy security.

The author is former Indian Ambassador to the UAE and Distinguished Fellow at the JSW School of Public Policy, IIMA.

Published on: Monday, June 29, 2026, 11:49 AM IST