NEW DELHI: Global crude oil prices surged on Thursday after Iran bombed Qatar’s Ras Laffan LNG hub, as a retaliatory strike against Israel’s attack on Iran’s South Pars gas field on Wednesday. Brent crude rose around 6% on Thursday to touch $113.6 per barrel.
Hinting at more escalation, Iran threatened further attacks if its energy infrastructure was hit again.
The situation has raised concerns for India, which depends on energy imports from West Asia as 90% of the country’s LPG imports and 47% of LNG imports come from this region, with Qatar being a key supplier.
Ras Laffan is one of the world’s largest natural gas processing hubs operated by QatarEnergy. Iran’s attack on it triggered a major fire and forced production halts. Qatar’s foreign ministry said most incoming missiles were intercepted, but one hit the facility. QatarEnergy CEO Saad al-Kaabi said the attacks damaged infrastructure accounting for 17% of Qatar’s LNG export capacity, with repairs expected to take years.
Underscoring the implications for India, Sujata Sharma, joint secretary in the Ministry of Petroleum and Natural Gas, said: “Any disruption in Middle East directly impacts us. The key question is how we deal with such risks. We are addressing this through diversification of supply sources. For crude oil, we have already diversified significantly—about 70% of our crude now comes from regions outside the Gulf and the Strait of Hormuz. Similarly, for LPG, we are expanding sourcing beyond traditional suppliers. For LNG, we are also sourcing from US and Australia.”
India’s LNG supplies were already under pressure after Qatar declared force majeure on some deliveries.
Industry analysts say it could take months to fully restore gas production at affected facilities. While India can diversify LNG imports, higher transportation costs may push up prices.
Despite rising crude prices, the government has said there will be no immediate increase in petrol and diesel prices.
The crude shock has also spooked equity markets, with equity investors’ wealth eroding by Rs 12.87 lakh crore on Thursday as BSE Sensex tanked 3.2%.