Even with a ceasefire now in place, hostilities could restart at a moments notice with energy supply routes across the Arabian Sea a particular concern for India.

What: As India and Pakistan once again step back from the brink, and Punjabi petrol stations seen panic buying, energy supply routes come to the fore.

Why: Much of India’s current LNG and crude supply makes its way across the Arabian Sea making it vulnerable to Pakistani attack at times of all out conflict.

What next: Diversification of sources with US-sources fuel seen as a benefit in time of war, but also a way to help India avoid the threat of tariffs by Washington.

As geopolitical tremors once again rattle the Indian subcontinent, a familiar spectre returns to India’s petrol pumps: panic buying with Indian Oil Corporation Limited (IOCL), the nation’s largest fuel supplier, stepping in to calm nerves according to India Today. In a public message on May 9, the company urged restraint, assuring citizens that fuel stocks were ample and supply lines secure. “IndianOil has ample fuel stocks across the country, and our supply lines are operating smoothly. There is no need for panic buying—fuel and LPG are readily available at all our outlets,” the company posted on X.

The plea comes against the backdrop of escalating hostilities with Pakistan, following India’s ‘Operation Sindoor’ military strike on terrorist hideouts in Pakistan and Pakistan-occupied Kashmir. Drone strikes in Indian cities by Pakistan have only intensified public anxiety, driving residents—particularly in northern states like Punjab—to fill tanks, jerrycans and LPG cylinders in anticipation of disruption.

In Punjab, civilian concern is increasing despite a May 10 ceasefire announcement that for now appears to be holding. From Amritsar to Pathankot, petrol stations have been besieged with social media videos showing long lines for fuel. Yet, no alert has been issued by the Ministry of Petroleum and Natural Gas, and IOCL continues to insist that “calm behaviour would help the company continue to supply fuel smoothly.”

Despite these reassurances, and IOCL shares slipping 1% on May 9, the oil sector as a whole appears caught in a web of geopolitical and economic strain. Brent crude edged up by $0.23 to $63.07 per barrel, while US West Texas Intermediate (WTI) gained $0.21 cents to hit $60.12 and while this can largely be attributed to broader global tensions, including persistent trade disputes between the US and China, the India-Pakistan flashpoint is fast becoming a complicating factor in Asia’s energy landscape.

A broader energy strategy in play

As such, India has been deepening its energy ties with Washington. Data shows that in April alone, India imported 326,000 barrels per day (bpd) of US crude, marking a 34% increase from March. That March figure itself had jumped 67% over February, a testament to how swiftly India is shifting its energy calculus.

To this end, analysts suggest this is part of a dual strategy: to secure alternative sources of energy amidst potential regional instability and to strengthen economic ties with Washington in hopes of tariff relief.

Those factors are already bearing out. Bloomberg recently cited Kpler data showing that a record 11.2mn barrels of US crude are currently en-route to India, expected to arrive by June in what is the highest such volume since August 2024 according to Oil Price.

It is understood that state-owned Indian refiners such as IOCL and Bharat Petroleum have led this import drive, securing tenders for at least 6mn barrels of American crude last month alone.

The LNG complication

Even as India turns Westward for crude though and with one eye on Pakistan’s military actions to the Northwest, the LNG picture is less optimistic. The ongoing strain with Pakistan threatens to compromise pipeline logistics and maritime routes of the fuel. While India imports most of its LNG from Qatar, Australia, and the US, safe passage through the Arabian Sea and related coastal infrastructure becomes more vulnerable under military tension. And even with a tentative ceasefire in place, there are still concerns that at any point, Pakistan or terrorist groups linked to Islamabad could act against Indian shipping in the Northern Arabian Sea.

With shipping routes potentially under surveillance or even targeted, insurance premiums on energy transport have begun creeping upward. The heightened naval alert across India’s western seaboard reflects concerns that retaliatory strikes or disruptions could spill over into critical trade lanes.

Moreover, any escalation in hostilities risks halting bilateral initiatives like the proposed India-Pakistan gas pipeline—a project that, although largely dormant, has long been considered a potential energy game-changer in South Asia.

Domestic impact: fuel anxiety meets energy diplomacy

At a domestic level, the convergence of regional conflict and global trade manoeuvring in fuel and other supplies is already having consequences. While fuel queues reflect fear of supply shocks, the government’s trade strategy is simultaneously about ensuring long-term energy resilience. Yet the paradox remains: in order to avoid reliance on neighbours during conflict, India is becoming more tethered to global market fluctuations and international diplomacy.

While supply chains remain intact for now, the margin for error narrows when conflict lurks. A miscalculation, a blockade, or a sudden attack could convert panic into a genuine crisis on both sides of the India-Pakistan border.

In the meantime, India’s doubling down on US crude can be read as a hedge against regional instability—a signal that New Delhi intends to widen its supplier base, reduce dependence on the Middle East, and perhaps, most critically, send a message to Washington: India is open for energy business, but it expects concessions in return.

With public sentiment intertwining with energy politics across the north of India and Eastern Pakistan, the recent drone strikes and military operations only animate fears of disruption. So much so that India’s energy narrative has shifted from self-sufficiency to strategic sourcing meaning that whether importing record volumes of US crude or insulating itself from LNG chokepoints off its West coast, India’s response is layered, calculated, and quietly urgent.

The fuel queues in Punjab may fade in a few days, but the questions they raise—about resilience, diplomacy, and preparedness—are far from settled.