India’s crude oil production fell for the third consecutive financial year in 2025/2026, the government said as it launches a push to boost offshore oil and gas exploration.
India’s crude output fell by 3% in the 2025/2026 fiscal year ended March 31, 2026, Oil and Natural Gas Minister Hardeep Singh Puri told Parliament.
“The domestic oil production over the last three years has shown a slight decline, primarily owing to natural decline in mature and ageing oil and gas fields,” the government said.
State-owned Oil and Natural Gas Corporation (ONGC), the biggest explorer in the country, contained the annual decline to about 2% thanks to Enhanced Oil Recovery (EOR) and Improved Oil Recovery (IOR).
However, India aims to boost offshore oil and gas exploration to raise production and reduce dependence on imports, which is as much as 90% for crude oil.
Last month, the federal government launched the so-called National Offshore Exploration Scheme, with $8.8 billion in government support through FY 2030–31. The scheme is India’s most ambitious offshore exploration mission to date.
As part of the program, the government will provide financial support of up to 50% of the cost of drilling deepwater exploration wells. The support will reduce exploration risk, encourage investment, and accelerate the development of India’s offshore hydrocarbon potential, according to the government.
India’s future hydrocarbon potential lies largely in deepwater and ultra-deepwater basins such as Krishna-Godavari, Cauvery, Mahanadi, and the Andaman region. Exploration in these frontier areas requires advanced technology and significant investment, with a single deepwater exploratory well costing about $125–150 million.
“Recognising the high-risk, high-cost nature of such exploration, the Government is adopting a risk-sharing approach to encourage sustained investment, accelerate exploration, and unlock India’s offshore hydrocarbon resources,” the federal government said.
As part of strengthening energy security, India also plans build new storage sites as the world’s third-largest crude oil importer looks to boost its resilience to supply shocks.
By Tsvetana Paraskova for Oilprice.com
