Saudi Arabia’s state oil giant Aramco has reportedly halted crude oil supplies to Indian refining companies, citing supply disruptions. India meets a large share of its crude requirement through imports, making any interruption a key concern for refiners.
The disruption is linked to tensions in the Gulf region, where conflict involving Iranian and US forces has affected shipping and logistics. A drone attack on Saudi Arabia’s east–west pipeline has kept flows on that route shut, reducing options to move crude to west coast ports.
At the same time, crude movements through the Strait of Hormuz have also been impacted, forcing Indian refiners to look for alternative sources. Brent crude has risen above Rs 10,300 per barrel, while tanker freight rates have increased, adding to procurement costs.
Economists also note that discounts on Russian crude—one of India’s major purchases—have narrowed, potentially pushing costs higher. While Saudi crude has not disappeared entirely from the market, some cargoes are reportedly still being sold in the spot market, with a possibility that a portion could reach India via Hormuz, though without the price and supply certainty of long-term contracts.
Since the start of the US–Iran conflict, Saudi Arabia’s share in India’s total crude imports has been about 9%. If disruptions persist, refiners may face higher replacement costs and pressure on margins.
