How India, UAE are strengthening bilateral energy ties

New Delhi: As part of the strengthening bilateral energy ties, India’s imports from the UAE have risen sharply over the years from less than one million barrels a day in the 1990s to about 4.4 million barrels a day in 2018, after which the Gulf nation has become the fourth largest crude supplier for India in 2026, according to an article in Gulf News.

India’s energy ties with the UAE took a quantum jump in 2018 with public sector ONGC Videsh, Indian Oil Corporation and Bharat PetroResources bought a 10 per cent interest in Abu Dhabi’s Lower Zakum offshore oilfield with an investment of $600 million.

India’s petroleum ministry told Parliament that it was the country’s first investment in Gulf oil production. It estimated that the stake would give the consortium an average of 1.75 million tonnes of crude a year over the 40-year concession, states the report by journalist Justin Varghese.

By 2026, Ministry of External Affairs listed the UAE as the country’s fourth-largest source of crude and its second-largest source of both liquefied natural gas and liquefied petroleum gas.

In May 2026, New Delhi and the UAE signed an agreement enabling India to hold part of its strategic oil reserve in Fujairah, where tankers can load outside the Strait of Hormuz. The same agreement opened the door for Abu Dhabi National Oil Company (ADNOC) to store up to 30 million barrels in India.

India has chosen Visakhapatnam in Andhra Pradesh as a site where ADNOC could participate in an existing oil storage facility. It also identified Chandikol, in Odisha, as a location where the two sides could work on developing reserve facilities. The proposed 30 million barrels is the potential total for ADNOC crude storage in India under the agreement.

The memorandum also covers possible cooperation on storage facilities in India for liquefied natural gas (LNG), and liquefied petroleum gas (LPG).

The port already gives Abu Dhabi a way to ship oil without passing through Hormuz. ADNOC’s existing 406-km pipeline carries crude from its onshore operations to Fujairah, where tankers can load for India. The route took on greater significance in 2026 as the conflict in the Gulf disrupted shipping through the strait, a risk India’s finance ministry highlighted in its May economic report, the article points out.

ADNOC is building a second route to the port. In May, the company said its West–East Pipeline was under construction and expected to become operational in 2027. ADNOC expects the project to double its export capacity through Fujairah, the article added.

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