Why is India seeking to build its own oil tanker fleet?

India is seeking to build its own oil tanker fleet in order to tackle the surging global oil tanker rates, which have become a significant challenge for the country that imports nearly 88% of its oil and 51% of its gas needs.

What are the challenges India faces in building its own oil tanker fleet?

The main challenges India faces in building its own oil tanker fleet are the massive capital investment required and the specialized expertise needed to construct massive oil tankers, which make this an ambitious and challenging goal.

How have US sanctions on Russian oil companies affected India's oil imports?

The US sanctions imposed last month on Moscow-based oil majors Lukoil and Rosneft have forced India to skip buying cheap Russian crude, further exacerbating the country's energy security issues amid rising transportation costs.

Home / Business and Economy / India Races to Build Domestic Oil Tanker Fleet Amid Surging Global Rates

India Races to Build Domestic Oil Tanker Fleet Amid Surging Global Rates

14 Nov

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Summary

Global oil tanker rates have shot up again
India imports 88% of its oil and 51% of its gas
Massive capital investment and expertise needed to build oil tankers

India Races to Build Domestic Oil Tanker Fleet Amid Surging Global Rates

As of November 14th, 2025, global oil tanker rates have once again shot up, posing a significant challenge for India, a country that imports nearly 88% of its oil and 51% of its gas needs. In September 2025, the rate to ship crude from Saudi Arabia to China stood at around USD87,000 per day for a Very Large Crude Carrier (VLCC).

In response to this issue, India is now seeking to tackle the problem by owning its own fleet of oil tankers. This ambitious plan, however, faces significant hurdles. Building massive oil tankers requires massive capital investment and specialized expertise, which may prove easier said than done.

The situation has been further exacerbated by the US sanctions imposed last month on Moscow-based oil majors Lukoil and Rosneft, forcing India to skip buying cheap Russian crude. With rising transportation costs and limited access to affordable oil sources, India's energy security is under increasing strain.