What is the news?
Iran has closed the Strait of Hormuz amid the ongoing war with Israel and America. After this, the global oil market is facing concerns, because about 20 percent of the world’s crude oil and gas is transported through the Strait of Hormuz. This step of Iran is sure to affect India also, because India also imports oil through this route. Let us know what options India has.
cape of good hope
Will India import oil through Cape of Good Hope?
The Cape of Good Hope is a landmass located on the Atlantic coast of South Africa. Portuguese explorer Bartolomeu Dias named it the Cape of Storms in the 1480s. King John II of Portugal later renamed it Cape of Good Hope, as it opened a sea route to India and Asia. However, this is a longer and more expensive route than the Strait of Hormuz.
What are the disadvantages of importing from the Cape of Good Hope?
Before the opening of the Suez Canal, the Cape of Good Hope was the most economical sea route between India and Asia. However, the Suez Canal provided a shorter and safer route from the Mediterranean Sea to the Indian Ocean, reducing both travel time and expense.
Indian Express According to , the journey from India to Europe via Cape of Good Hope takes 15-20 days more.
Does India have enough oil reserves?
a government source The Hindu Told that India has enough reserves of crude oil and energy products for the next 25 days. According to ship tracking service Kpler, India has about 100 million barrels of commercial oil reserves, held in storage tanks, underground strategic reserves and in ships headed to the country. If the Strait of Hormuz remains closed, then this requirement can be met for 40-45 days.
How much oil comes to India through the Strait of Hormuz?
India imports about 2 billion barrels of oil every year, which is 88 percent of its total requirement. Data from ship tracking service Kpler shows that about 50 per cent of India’s crude oil imports pass through the Strait of Hormuz. That means 25 to 27 lakh barrels per day. The oil that India buys from Iraq, Saudi Arabia, United Arab Emirates (UAE) and Kuwait comes through this route.
Will India buy oil from Russia?
The biggest option before India to ensure its energy security is Russia. India has been buying oil from Russia in huge quantities in the past also at concessional rates. Even at present Russia has kept this option. However, buying oil from Russia may incur America’s displeasure, because there is a condition in the interim trade agreement between India and America that India will reduce its dependence on Russian crude oil.
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