West Asia war, Strait of Hormuz blockade could double delivery time of India’s energy shipment: Report

The delivery times of India’s oil and gas imports have taken a major hit amid growing tensions in
West Asia, with an analysis showing that the delivery time has doubled. The trend has raised costs and tightened energy markets amid rising geopolitical tensions.

According to an analysis conducted by Money Control, 59.5 per cent of India’s LNG imports come from West Asia, higher than China’s reliance on the region, which stands at 26.5 per cent and Japan’s 10.7 per cent. Hence, chaos at the Strait of Hormuz leaves India in a vulnerable state regarding the global energy shipments.

Cargoes travelling from the
Gulf typically reach India quickly. Sonal Ranjan, an LNG and natural gas analyst at Kpler, shared the timeline of the transportation of LNG to Money Control. Shipments from the UAE’s Das Island take roughly 4-6 days to reach India’s west coast terminals such as Mundra or Dahej, and about 11-12 days for east coast terminals such as Dhamra or Ennore, she said.

However, in the current circumstances, replacing these supplies with Cargoes travelling from an alternate route would significantly extend the transit times.  For example, LNG shipments from Western Australia generally take 9-12 days to reach India, while cargoes from Australia’s east coast projects can take 15-17 days, depending on the destination terminal.

Shipments from the US would be the slowest

Meanwhile, Supplies from
West Africa would take even longer. For instance, cargoes from Nigeria typically take 18-24 days to reach India, with an average sailing time of roughly 19-20 days via the
Cape of Good Hope. Shipments from the United States, on the other hand, would be the slowest, requiring around 30-35 days to reach India, also via the Cape of Good Hope, Ranjan told Money Control.

The cost would also increase since, under the current circumstances, Asian buyers would pay higher premiums to attract cargoes away from Europe. “For alternative supply given a Strait of Hormuz disruption, replacement sources could include US cargoes, West Africa, such as Nigeria, and Australia, though incremental flexibility is limited,” Ranjan told the news outlet, adding that Asian buyers may need to pay a premium over European prices to secure supplies.

According to ICRA analysis, rerouting vessels between Europe and Asia via the Cape of Good Hope instead of the
Suez Canal will add 10–15 days to travel time. Apart from this, war-risk insurance premiums have increased to 0.75-1 per cent of a vessel’s insured value, up from about 0.5 per cent earlier.

Back in 2024, India imported about $15 billion worth of LNG, becoming one of the world’s largest importers. The top five suppliers account for around 83.5 per cent of India’s LNG imports, which limits the diversification in sources.

Not only LNG but crude oil shipments have also been impacted by the crisis in West Asia. Oil cargoes from western
Russia typically take 20-35 days to reach India, while shipments from the eastern Russian seaboard take around 12-15 days, according to Money Control analysis.

It is pertinent to note that currently, India maintains over three weeks of energy reserves, which could cushion short disruptions. However, a prolonged conflict affecting Gulf shipping routes could force New Delhi to rely on distant suppliers, ultimately raising both delivery times and energy costs.