Energy shortages due to the war in West Asia have put the spotlight on India’s need to increase its domestic oil exploration and production efforts. While supplies of petrol and diesel remain adequate for now, LPG shortages have persisted, prompting a parliamentary panel to call for an urgent review next week to focus on domestic production. The oil and gas import bill for 2025-26 is expected to cross $120 billion and, given the volatility in global prices and the weakening rupee, is likely to remain elevated until 2026-27. At less than 1 percent of global proven reserves, India’s crude reserves do not amount to much compared to those of major producers. However, domestic production meets about 15-18 percent of the country’s considerable demand at present. So import dependence will be reduced by over 80 percent if production can be increased at home.
Although India has 3.36 million sq km of sedimentary basins, only 10 percent is under exploration as some of the 26 marginal and deep water basins remain unexplored. According to S&P Global Commodity Insights, just four largely unexplored sedimentary basins could hold up to 22 billion barrels of oil. The government has been trying to boost production, with ONGC investing $10 billion in developing multiple deepwater projects in the Krishna-Godavari basin and Oil India trying to double its exploration acreage. As the prime minister noted recently, India could attract more foreign funding in the energy sector, with an estimated investment potential of $500 billion by the end of this decade.
