$22 billion extra for fuel: India among countries that paid the most in Strait of Hormuz price shock, study reveals | Today’s news

Analysis by the Center for Energy and Clean Air Research (CREA) revealed that fossil fuel importers paid $330 billion in gross additional costs for crude oil, petroleum products and LNG in the six months following US-Israeli strikes against Iran in February 2026. This was more than pre-war futures markets expected over the same period.

The report, released on August 26, highlighted the “biggest sustained shock to oil prices” caused by the US-Iran war since the 1990 Gulf War.

“During the first six months of the conflict, Asian LNG prices averaged 75% higher than pre-war expectations, European LNG prices 60% higher, diesel 59% higher and crude oil 35% higher,” the CREA analysis revealed.

Movement in the Strait of Hormuz, a key economic trade route off Iran’s coast, remains restricted as the war between Iran and the US continues.

The study compared actual fossil fuel prices over the past six months with monthly expected prices in the 12-day period before the US and Israel first struck Iran.

How much did India and other countries pay?

According to the CREA report, the EU incurred the highest gross excess costs ($78 billion), followed by China ($35 billion) and India ($22 billion).

This means that India suffered a gross additional cost of $22 billion in the six months following the strikes on Iran compared to what the pre-war futures curves expected.

India, the single largest importer of LPG, was among the 20 countries, second only to China, that paid the most for the price shock in Hormuz. India’s net additional cost for all fuels was $14.4 billion.

This net additional cost of $14.4 billion corresponds to 0.38% of India’s GDP, a loss of approximately 1.4 days of national income.

Indian LPG, crude oil imports

China paid $31.3 billion net and India $20.5 billion for oil between March and August 2026, a combined 40% of the $131.2 billion total.

According to the report, the bill for LPG imported into India during the six months was around USD 4.7 billion, of which about a fifth was the additional cost due to the price shock.

Those additional costs were paid for volumes that collapsed in March to half the average of the previous two years (2024 and 2025) and returned to 86% of that level by June, the report added.

For the full six months, the additional cost of importing LPG to India is estimated at USD 1.1 billion.

Among importers, a typical low- or middle-income country paid about twice as much as a typical high-income country relative to GDP, the report said.

India’s LPG imports down 49% in March

The CREA report revealed that India’s LPG imports fell by 49 percent in March, the first full month of the US-Iran war, compared to the average of the previous two years.

The US share of LPG imports to India rose from 8% in February to 16% in March and 32% in April, making up for some, but not all, of the volume lost in the Persian Gulf.

Readily available monthly trade figures only cover a minority of importing countries and do not include the largest, China, so any global LPG figure would be based on a biased sample.

India is reported instead because it reports both the volumes and the origin of the cargo, the report added.

Investments in clean energy helped manage the crisis

In the first five months of the crisis alone, clean energy production added from 2020 has saved importing countries an estimated $36 billion in avoiding coal, gas and oil imports.

This includes US$22 billion in gas imports, US$10 billion in coal imports and US$5 billion in oil imports.

“In absolute terms, the largest savings were in China ($7.9 billion) and Japan ($4.9 billion), followed by Spain, France, Italy, the Netherlands, Brazil and India,” adds the CREA report.

Measured against what each country would have otherwise paid to import fossil fuels, Brazil avoided 35%, Lithuania 25%, Denmark 24% and Sweden 19% of the total value of domestic imports. Outside the EU, Brazil and Colombia recorded the largest proportional savings.

According to the IEA, global investment in renewables will reach $700 billion in 2025, or $58 billion per month.

Global monthly investment in renewables was just 5.6% higher than the $55.3 billion in additional monthly fossil fuel import costs caused by higher offshore oil and gas prices following the Iran war.