India’s refining capacity stands as a key strength in its energy landscape- an industrial capability that not only meets domestic fuel needs but also supports regional exports. Yet, this advantage coexists with a persistent dependency on imported crude oil, exposing India to volatility in global markets and foreign exchange pressures. Thus, the challenge of balancing refining self-sufficiency with crude import reliance remains central to India’s energy policy.
India’s Position in the Global Refining Landscape
According to the Petroleum Planning & Analysis Cell (PPAC), India’s installed refining capacity reached over 258 MMTPA by September 2025, accounting for about 5% of global capacity. This makes India the fourth-largest refiner in the world, after the United States, China, and Russia. Public sector refineries such as Indian Oil Corporation, Bharat Petroleum, and Hindustan Petroleum together represent around 60% of this capacity, while the remainder is held by private players like Reliance Industries and Nayara Energy.
The Persistent Crude Import Burden
Despite this robust refining base, India’s dependence on imported crude continues to rise. Crude oil imports were about 242.4 MMT in FY2024-25, meeting over 88% to 89% of domestic consumption. During Q1 FY 2025‑26 (April–June 2025), India’s total oil & gas import bill moderated to around USD 10 billion per month, aided by soft global prices (Brent averaging USD 70–72/bbl) and steady domestic demand. While refined product exports, particularly diesel and aviation turbine fuel (ATF), bring in foreign exchange, they only partially offset the overall import burden.
To mitigate this structural dependence, the government has pursued multiple diversification measures. The Ethanol Blending Programme (EBP) achieved an average ethanol blending rate of 12% by mid-2025, as reported by the Ministry of Petroleum and Natural Gas (MoPNG) in June 2025. The program targets a 20% blending rate by FY2025-26, which could displace nearly 6 million tonnes of petrol annually, significantly lowering crude oil import requirements and enhancing energy security.
Green Hydrogen: The Next Frontier
The National Green Hydrogen Mission (NGHM), launched in 2023, is progressing steadily toward its goal of making India a global hub for green hydrogen production, usage, and export. The mission plans to produce 5 million metric tonnes of green hydrogen annually by 2030, backed by an investment target of Rs. 19,744 crore and associated renewable energy capacity addition of about 125 GW.
As of 2025, several green hydrogen hubs and innovation clusters have been identified, including major ports like Deendayal (Gujarat), Paradip (Odisha), and V.O. Chidambaranar (Tamil Nadu). Pilot projects are underway across sectors such as steel, shipping, road transport, and fertilisers, supported by substantial R&D investments and policy incentives. These initiatives are integral to India’s broader Energy Transition Roadmap 2024, which targets reducing carbon intensity and enhancing energy security through diversified, clean energy sources like ethanol and green hydrogen.
Strategic Petroleum Reserves: Building Energy Resilience
Strategic reserves are another critical layer of resilience. As of mid-2025, the Indian Strategic Petroleum Reserves Limited (ISPRL) manages strategic petroleum reserves with a total storage capacity of 5.33 million metric tonnes (MMT) of crude oil across three underground facilities: Visakhapatnam (1.33 MMT), Mangalore (1.5 MMT), and Padur in Karnataka (2.5 MMT). These reserves provide India with approximately 9.5 days of net import cover, strengthening the country's capacity to handle supply disruptions or emergencies.
The government has approved Phase-II projects to expand strategic reserves by an additional 6.5 MMT in two locations: Chandikhol in Odisha (4 MMT) and Padur in Karnataka (2.5 MMT). These new caverns, when fully commissioned, are expected to add about 6.5 days of net crude import cover to India's emergency preparedness.
This eminent expansion represents a critical buffer safeguarding the country’s energy security by covering roughly 16 days of crude imports when full expansion is realised. This layered resilience is vital for the analysis of India's emergency preparedness and risk mitigation against global supply shocks.
Looking ahead, refinery-petrochemical integration is emerging as a key theme in MoPNG and NITI Aayog’s FY2025-26 plans, allowing refiners to capture more value from the same crude input. Investments in carbon capture, utilisation, and storage (CCUS), as well as co-processing of bio-feedstocks, are also under consideration to align refining with global decarbonisation goals. Additionally, domestic exploration under the Open Acreage Licensing Policy (OALP) aims to improve upstream self-reliance by enhancing indigenous crude production.
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