Archive · 25 Jun 2025
Iran-Israel Conflict Threatens India's Economic Growth
The conflict between Iran and Israel is making oil prices go up.
India buys almost all of its oil from other countries, and a lot of it comes through a narrow waterway called the Strait of Hormuz.
If the fighting causes problems in that area, India might have to pay more for oil, which could slow down how quickly the country's economy grows.
Even though India gets oil from different places, the situation in the Middle East is still a worry.
Conflict between Iran and Israel raises concerns about global oil supply disruptions.
India imports nearly 90% of its crude oil, making it vulnerable to price fluctuations.
The Strait of Hormuz is critical for global oil transit, with India dependent on it.
SBI Research projects that a crude price spike to $130 could reduce India's GDP growth to 5.1%.
India has diversified its oil sources but remains exposed to risks in the Middle East.
- Who
- India, Iran, Israel, and global oil markets.
- What
- Impact of Iran-Israel conflict on India's economy and oil supply.
- When
- Ongoing, with potential for escalation.
- Where
- Global oil markets, particularly the Middle East and Strait of Hormuz.
- Why
- To understand India's vulnerability to oil price shocks and economic impacts.
Vulnerability
Resilience
Supply Chain
Vulnerability
Heavy import reliance creates risk for India.
Resilience
Diversification may help mitigate risk.
Economic Stability
Vulnerability
Conflict can increase prices and harm economy.
Resilience
Impact can be limited with effective measures.
- India's Crude Oil Imports
- Approximately 90%
- Oil Transit through Strait of Hormuz
- Approx. 20% of world's oil
- Potential GDP Growth Impact
- 5.1% if oil hits $130/barrel
- India's Oil Sources
- Over 40 countries
- Oil Price Increase Since May
- Roughly 10%
Sources
Iran-Israel war jolts oil market but India’s supply secure: Sonowal
From empires to oil: The story of the Strait of Hormuz
Why Oil Prices Dropped Right after Trump's Announced Iran-Israel 'Ceasefire'
How India is preparing for oil supply disruptions during Iran-Israel conflict | Explained
India on track to make Chabahar preferred port of call in Iran for trade with Central Asian nations, says shipping secy
Here's New Delhi's game plan to solve the Hormuz riddle
Explained: Why Closing Strait Of Hormuz Could Backfire On Iran
Oil prices rise over 1% amid Israel-Iran ceasefire, Brent at $68/bbl
Middle East crisis: Why is India’s oil dependence a risk again? And what Vedanta’s Agarwal thinks should change
