US-Iran ceasefire ends: Crude supply resilient, but LNG, LPG face bigger Hormuz risk; Here's why

Indian markets should be more concerned about the LNG and LPG supplies compared to crude availability amidst the recent exchange of fire between the US and Iran near the Strait of Hormuz, say experts.  

US President Trump's comments on a ceasefire have once again raised concerns over the security of the Strait of Hormuz.

Crude flows through the Strait had not fully recovered before the latest escalation. For India, however, it has largely been business as usual over the past 100 days, with refiners successfully managing supply through a diversified import portfolio, says Sumit Ritolia, Modelling Refinery and Oil Markets at Kpler.

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Diversified crude basket

India's crude import basket today is far more resilient than it was a few years ago, and there has been oil import diversification in the past few years.

Ritolia says the Russian crude continues to anchor a significant share of imports while Saudi and UAE barrels delivered via bypass infrastructure provide an additional layer of supply security.

The West African and Latin American grades continue to supplement refinery requirements. Cargoes that can safely transit the Strait of Hormuz are still expected to move, although freight rates and insurance costs could rise if tensions persist.

“One question that often comes up is whether Iranian crude could fill any supply gap. In reality, that remains unlikely for Indian refiners. Uncertainty around US sanctions policy, compliance risks, and commercial considerations means Iranian barrels are unlikely to become a meaningful part of India's crude slate in the near term,” he explains.

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LNG, LPG need closer attention

Ritolia emphasises that the market should pay closer attention to LPG and LNG.

“Unlike crude, these markets have fewer short-term substitution options and remain more exposed to Gulf supply and shipping disruptions. A prolonged period of instability could tighten availability, increase freight costs, and add pressure to regional prices again, as we have seen over the last few months,” he said.

For now, India's crude supply story remains one of diversification and resilience, not immediate scarcity.

“The key variables to watch are how long regional tensions persist, the impact on shipping and insurance costs, and whether LPG and LNG markets begin to experience more meaningful disruptions,” he added.