Modi Reaches Out to Iran as Energy Crunch Fears Grip India

Indian Prime Minister Narendra Modi has reached out to Iranian authorities as concerns grow over potential disruptions to energy supplies linked to tensions in the Strait of Hormuz. The move comes as the conflict in the Middle East raises fears of an energy crunch for India, one of the world’s fastest‑growing major economies.

Shipping through the Strait of Hormuz has become increasingly uncertain following military escalation involving Iran. The narrow waterway is one of the most critical chokepoints for global energy trade, carrying roughly one‑fifth of the world’s seaborne oil shipments. Any prolonged disruption could severely affect major Asian importers including India and China.

India imports about half of its crude oil from the Middle East, leaving the country highly exposed to supply shocks from the region. Analysts say India’s strategic petroleum reserves cover only about 20 to 25 days of demand, significantly less than the reserves held by several other Asian economies.

Rising oil prices are also increasing economic risks. A sustained surge in crude costs could widen India’s current account deficit, weaken the rupee and fuel inflation. In response, New Delhi is exploring alternative supply options, including additional purchases of Russian crude and sourcing from other regions, while maintaining diplomatic engagement with regional powers.