Should Energy Markets Fret Over India-Pakistan Hostilities?
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Crowd in India holds posters reading “Operation Sindoor” in support of a missile strike operation so … More named by India and carried out against Pakistan on May 7, 2025. India claims the strikes targeted terrorist sites in Pakistan, a claim it denies. (Photo: Diptendu Dutta) Middle East Images/AFP via Getty Images Nuclear armed neighbors India and Pakistan were involved in a series of armed skirmishes that started on Wednesday and threatened to spill out into an all out war, before a ceasefire was announced on Saturday. However, tension still lingers in the air and prolonged India-Pakistan hostilities could have massive implications for energy markets alongside any human and financial fallout. The hostilities followed India’s decision to launch a targeted missile and air-strike operation against Pakistan – Operation Sindoor – following a deadly terror attack on April 22 by militants in Pahalgam in Indian administered Kashmir killing 26 people. India blamed the attack on Pakistan-based terrorists and its government’s support for terror outfits, a claim the country denied. While a ceasefire brokered by the international community is holding at the time of writing, oil and gas and hydropower segments of both nations will most likely feel the heat in the wake of prolonged India-Pakistan tensions. Oil And Gas Market Scoresheet In terms of respective market sizes, India is the world’s third-largest consumer of crude oil, behind only the U.S. and China. According to the International Energy Agency, India consumes on average 5.4 million barrels per day of oil, nearly 90% of which is imported. It remains on track to account for 25% global oil demand growth in 2025, according to the U.S. Energy Information Administration – the statistical arm of the Department of Energy. Pakistan’s oil demand rate is considerably lower and has been fluctuating wildly south of 0.4 million…
Filed under: News - @ May 12, 2025 12:26 am