Who pays the bill?: The real cost of the war in West Asia for India |
John Mearsheimer writes in The Tragedy of Great Power Politics: “States rarely go to war unless they think that rapid success is likely.”
It has been more than a month since Benjamin Netanyahu and Donald Trump started the war in West Asia by attacking Iran. Clearly, they must have thought that things would not escalate, and they would see rapid success. But that hasn’t happened.
And every day the war continues, countries all across the world – including India – have to bear its cost.
In 2025-26, India imported close to 89 percent of the crude oil that it consumed. More than half of the natural gas consumed was imported.
The war in West Asia has, for the most part, closed the Strait of Hormuz, through which a significant share of global oil and gas production passes. India sources barely any crude oil from Iran, but relies heavily on suppliers such as Saudi Arabia, Iraq, the United Arab Emirates, Qatar, Kuwait and Oman. In 2025–26, these countries together have accounted for well over half of India’s oil and petroleum product imports.
Much of this energy supply travels through the narrow Strait of Hormuz, which links the Persian Gulf to the Gulf of Oman. Roughly one-fifth of the world’s oil output passes through this chokepoint. With the war disrupting maritime traffic in the strait, tanker movement has slowed sharply, pushing up global oil and gas prices.
The price of the Indian basket of crude oil averaged at around $69 per barrel in February. As of April 1, it stood at $120.84 per barrel. Natural gas prices have risen from $6.21 MMBTU (Metric Million British Thermal Unit) in February to $10.76 MMBTU in April, a jump of over 73 percent. This has impacted the entire Indian economy.
1) The price of industrial diesel has gone up by Rs 22 per litre or 25 percent to Rs 109.6 per litre. Firms buy industrial diesel bulk to meet their specific energy needs. This hike will creep into inflation. Of course, some firms will try to get around this by buying retail diesel at pumps.
2) The price of the 19kg commercial LPG cylinder has been increased. This makes eating out expensive. News reports suggest a shortage of these cylinders, leading to limited menus at restaurants. Many news reports also suggest a shortage of domestic cooking gas cylinders. This seems to be leading many migrant workers to return to their home states. Hoarding and black marketing haven’t helped.
3) The price of aviation turbine fuel used to fly planes has also gone up, though “only a partial and staggered increase of 25 percent (only Rs 15/litre)” has been passed on to the airlines flying domestic routes.
4) In all this, the prices for domestic cooking gas, retail petrol and diesel have not been increased. So, you and I have been protected on this front. But this will have broader repercussions, which we will look at later in the piece.
5) The points made above are rather obvious ones. But the impact of the war in West Asia on India will be much greater than that. Take the case of medicines. The production of drugs depends heavily on petrochemicals and a wide range of energy-intensive processes, making it vulnerable to any sustained rise in oil and gas prices.
A report in The New Indian Express points out that many medicines – such as paracetamol, penicillin, antibiotics and sedatives – are ultimately derived from petrochemical feedstocks like benzene, toluene and ethylene. The war in West Asia has disrupted supply,........