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    COVER STORY                                                            MARCH 13, 2026      |  The Indian Eye                    4

                                                           WAR ON IRAN

                                       IMPACT

                                ON INDIA

              Rising oil prices, market volatility and risks to the Gulf-based diaspora underline

              how the Iran conflict could ripple across India’s economy and strategic interests.

            OUR BUREAU

            Tehran / Doha / New Delhi
                  he escalating war involving
                  Iran, the United States and
            TIsrael  is emerging as  a major
            external risk for India, with potential
            implications for energy security, eco-
            nomic growth, financial markets and
            the safety of millions of Indians liv-
            ing in the Gulf. As tensions intensify
            across West Asia, the conflict is rever-
            berating through global energy mar-
            kets and shipping routes, particularly
            the Strait of Hormuz — a vital corri-
            dor for global oil flows and a lifeline
            for energy-importing economies such
            as India.
                Despite the uncertainty, govern-
            ment sources say India remains rela-
            tively well positioned in the short term
            due to diversified supply sources and
            existing fuel stocks.
                “India  is  in  a  very  comfortable
            position regarding crude oil, petro-
            leum products and LPG supplies,”   External Affairs Minister S. Jaishankar meets Deputy Foreign Minister of Iran Saeed Khatibzadeh on the sidelines of the Raisina Dialogue 2026,
            government sources said, adding that
            the country currently has access to                              in New Delhi on Friday. (@DrSJaishankar X/ANI Photo)
            energy supplies from multiple sourc-
            es that exceed the volume that could   However, economists caution      “Every USD 10 per barrel increase   gy markets, reflecting not only supply
            potentially be affected by disruptions   that the broader economic impact of   in global crude oil prices could reduce   risks but also rising insurance costs,
            through the Strait of Hormuz.     sustained geopolitical instability in   India’s GDP growth by about 0.5 per   freight rates and logistical disruptions.
                Officials  say  the  government  is   West Asia could still be significant.  cent,”  Bharti  said  in  an  interview.  “It is not simply about closing
            closely monitoring developments       Oil prices and economic           The recent surge in prices illus-  the Strait of Hormuz,” Bharti said.
            and plans to ramp up supplies from            pressure              trates the vulnerability. Crude oil pric-  “The real issue is that insurance pre-
            alternative geographies if necessary.                               es jumped from around USD 69 per   miums and freight charges are rising,
            Over the past few years, India has sig-  ndia remains one of the world’s   barrel to nearly USD 78 within a week   and shipments are being rerouted. All
            nificantly diversified its crude import   largest importers of crude oil,   as tensions escalated in the region.  these factors add a war premium to
            basket,  particularly after  increasing  Imaking its economy highly sensi-  “In just one week we have seen   crude oil prices and create uncertainty
            purchases from Russia.            tive  to  price  fluctuations.  According   crude move from about $69 to $78 per   in the market.”
                “In February, India imported   to Vandana Bharti, Research Head   barrel. If the tensions continue, pric-  India’s exposure to the region is
            about 20 per cent of its total crude oil   – Commodity at SMC Global Securi-  es could move towards $85 to $87 per   particularly high. Bharti noted that
            imports from Russia, amounting to   ties, rising crude prices could quickly   barrel in the coming days,” Bharti said.  “India imports nearly 50 per cent of its
            around 1.04 million barrels per day,”   translate into slower economic growth   Such increases add what analysts   crude oil from the Middle East, and
            government sources said.          and higher inflation.             describe as a “war premium” to ener-     Continued on next page... >>

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