India's Crude Oil and Natural Gas Production Continues Decline Amidst Rising Import Dependence
India crude oil production falls for 11th year, gas declines again
The Economic TimesImage: The Economic Times
India's crude oil production fell by 2.5% to 28 million metric tonnes in the 2025-26 fiscal year, marking the eleventh consecutive year of decline. Natural gas output also decreased by 3.7% to 34,776 million metric standard cubic metres. The country now relies on imports for 89% of its oil and 51% of its gas, highlighting vulnerabilities in supply security amidst geopolitical tensions.
- 01Crude oil production has declined for eleven consecutive years, down 22% since 2014-15.
- 02Natural gas output fell for the second year in a row, with a 3.7% decrease in 2025-26.
- 03India's import dependence for oil and gas has reached 89% and 51%, respectively.
- 04The decline is attributed to natural depletion of aging fields and a lack of major new discoveries.
- 05Government reforms have not attracted sufficient foreign investment to boost exploration and production.
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India's crude oil production has fallen for the eleventh consecutive year, decreasing by 2.5% to 28 million metric tonnes in the 2025-26 fiscal year, according to data from the Ministry of Petroleum and Natural Gas. This decline represents a 22% drop from 2014-15, when the downward trend began. Similarly, natural gas production also declined for the second straight year, falling 3.7% to 34,776 million metric standard cubic metres (mmscm). The country's increasing reliance on imports has become evident, with 89% of oil and 51% of gas being sourced from abroad, raising concerns about supply security, especially in light of recent geopolitical tensions such as the Iran war. The decline in production has been attributed to the natural depletion of aging fields and a lack of significant new discoveries over the past decade. Despite government efforts to attract exploration investments through various reforms, foreign firms have been hesitant to participate, leading to a dominance of domestic state-run players in licensing rounds. To revive production, substantial investments in exploration are deemed necessary.
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The decline in domestic oil and gas production increases India's reliance on imports, potentially leading to higher prices for consumers and businesses due to elevated international market rates.
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