India’s energy choices have been sub-optimal
India's energy choices have been sub-optimal, leaving the economy exposed to disruptions in global energy markets. The country is paying a steep price for aligning its oil purchases with US pressure, while competitors like China and Russia reap the benefits of the chaos.
India imports 85% of its crude oil, making it vulnerable to global market disruptions. The US has pressured India to halt imports from Iran and scale back purchases of Russian crude. However, India should consider buying Iranian oil, given its proximity and cheaper transportation costs. The Strait of Hormuz crisis has reduced tanker traffic, but Iranian crude continues to flow to China. Russia is also benefiting from the chaos, selling its Urals crude oil at a premium to Brent crude. India's economy is suffering from higher oil import costs and potential instability in the Middle East, which threatens its energy imports and trade flows.
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