Energy security in focus: PM Modi holds high-level meeting as Hormuz disruption hits supplies

Prime Minister Narendra Modi chaired a high-level meeting on Sunday with senior ministers to assess the impact of the evolving West Asia situation on India's energy and supply chains. During the meeting, he reviewed developments across the petroleum, crude, power, and fertiliser sectors. 

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Iran has nearly shut the Strait of Hormuz, disrupting energy flows to several Asian economies, including India, and triggering supply concerns across critical sectors.

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The government is taking proactive steps to safeguard energy security and maintain adequate availability, while continuing to monitor global developments to protect consumer and industry interests.

The immediate concern has been the impact on liquefied natural gas supplies, particularly for fertiliser production.

India's urea plants are running at half capacity after force majeure declarations disrupted LNG flows through Hormuz, news agency PTI reported on Sunday. 

Petronet LNG Ltd, which operates the country’s largest liquefied natural gas receiving terminal, has declared force majeure after upstream suppliers flagged their inability to deliver contracted volumes due to disruptions in cargo movement through the Strait.

The disruption has led to supply curtailments by state-run gas distributors GAIL (India) Ltd, Indian Oil Corporation Ltd, and Bharat Petroleum Corporation Ltd, which supply gas under RasGas contracts to fertiliser units across the country.

The supply squeeze has already reduced operating capacity at urea plants, raising concerns about downstream effects on agricultural inputs if the disruption persists.

The government's review assessed inventory levels, alternative sourcing options, and logistics arrangements as it prepares to manage the impact of prolonged disruptions in one of the world's most critical energy transit routes.