India Must Power Up Oil Reserves Amid Surging Global Energy Shocks: Rangarajan

Former Reserve Bank of India Governor C. Rangarajan has issued a clear call: India must urgently build its oil reserves and cut down on energy imports to shield itself from global trade shocks. His warning comes as recent geopolitical events, including the Middle East war and the effective closure of the critical Strait of Hormuz in February 2026, have severely disrupted international energy markets, sending oil and gas prices soaring. India, being the world's third-largest oil importer, is particularly vulnerable to these sudden shifts. Currently, India's Strategic Petroleum Reserves (SPR) hold about 5.33 million tonnes, enough to cover roughly 8 to 9.5 days of its crude oil needs, a modest amount compared to global benchmarks. To tackle this, the government is actively expanding its SPR capacity. A Phase-II expansion, approved in July 2021, aims to add another 6.5 million tonnes through new facilities in Odisha and Karnataka under a Public-Private Partnership (PPP) model, estimated at Rs 14,527 crore. Furthermore, state-owned Oil and Natural Gas Corporation (ONGC) is developing an additional 1.75 million metric tonne SPR cavern in Mangaluru, and new sites are being explored in Madhya Pradesh and Rajasthan. Beyond expanding physical reserves, India is pushing a multi-pronged strategy to enhance its energy security. This includes diversifying its crude oil suppliers, boosting domestic oil and gas exploration with a US$10 billion programme, and significantly accelerating the shift towards renewable energy sources. Initiatives like a Rs 37,500 crore coal gasification scheme and the Ethanol Blended Petrol (EBP) Program, which achieved 20% blending ahead of target, are crucial steps towards reducing India's heavy import dependence and building a more resilient, self-reliant energy future.