Trump Wants To Take Control Of Iranian Oil: Is It Good Or Bad News For India? Explained

US President Donald Trump on Sunday hinted that Washington could seize Iran's key oil export hub on Kharg Island in an interview with the Financial Times newspaper- a move that could escalate tensions swiftly and could rise oil prices to a zenith. Trump also openly voiced his broader objective regarding Iran's energy resources. He told the Financial Times, "To be honest with you, my favourite thing is to take the oil in Iran, but some stupid people back in the US say, 'Why are you doing that?' But they're stupid people," while dismissing domestic criticism, adding that opponents of such a move are "stupid people."

He further noted any potential operation might require a continued US presence. "It would also mean we would need to stay [on Kharg Island] for some time," Trump told the Financial Times.

For India, it is more than a mere concern. If Trump goes ahead with his plan of incursion on Kharg’s Island- a vital site which acts as “lifeline of Iran”, it could put India's energy needs in peril.

How important is Kharg's Island?

As per media reports, the island exports nearly 1-5-1.6 million barrels of crude oil every day. Although New Delhi halted the oil supply after the US imposed sanctions in 2019, any Iranian aggression could disrupt the oil flow in the Strait of Hormuz, a critical chokepoint which has been blocked by Tehran in response to a US-Israel joint military operation.

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China, which imports a large chunk of Iranian oil despite US sanctions, would definitely diversify its oil purchase. Like other commodities, oil market also works on the principle of supply and demand mechanism. If China jump with bulk orders into the already burdened oil market, this could quickly send the oil prices to a new height.

India, which imports nearly 85-90 per cent of its crude and routes a large portion through the Strait of Hormuz, would face significantly higher fuel, LPG, and LNG costs, adding pressure on inflation, the rupee, and the current account deficit.

Long-term scenario

If US control leads to a swift regime change, weakened Iran, or forced reopening of full oil flows under new terms, global supply could eventually stabilise, and prices might fall. This could benefit India as a net importer. However, experts warn that holding Kharg Island would be militarily challenging and could prolong the conflict, delaying any price relief and keeping volatility high for months.

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Is it good news for India?

India’s economy is highly sensitive to oil price shocks. Higher energy costs would raise transportation, manufacturing, and household expenses, potentially slowing growth and forcing tougher policy choices.

While India has built some strategic reserves and diversified sources such as Russia, Saudi Arabia, Iraq and the UAE, it remains vulnerable to Gulf disruptions. Most analysts view escalation involving direct control of Iranian oil as a net negative for major importers like India due to immediate pain outweighing uncertain long-term gains.

(With inputs from agency)