Energy security now India’s biggest upstream priority amid global oil market reset, says S&P Global

Energy security has emerged as India’s new upstream priority as global oil and gas markets undergo a structural shift driven by geopolitical uncertainty, rising costs and supply risks, according to Nick Sharma, Executive Director, Upstream Energy, S&P Global Energy.

Sharma said global upstream markets are witnessing a major reset in 2026, with the focus moving from efficiency-led growth to security-driven resilience. Rising geopolitical tensions, higher oil prices and elevated operational risks are pushing energy companies and investors to reassess strategies and prioritise stable and secure resources.

Investment patterns are also changing, with capital increasingly moving towards projects that offer faster development timelines, lower execution risks and quicker returns. At the same time, inflation across supply chains — including materials, logistics and services — is forcing companies to maintain strict capital discipline and focus on cost control.

More from Business

For India, the changing global energy landscape highlights a key challenge: securing upstream access. Despite being one of the world’s largest energy consumers, India continues to depend heavily on external hydrocarbon resources due to limited domestic production. The Middle East remains a crucial part of India’s supply chain, making disruptions in the region a direct risk for energy availability and price stability.

Sharma noted that India’s upstream strategy needs to focus on diversification and long-term resource security. National oil companies will need to expand their overseas upstream portfolios to secure equity oil and gas assets across multiple regions, reducing dependence on concentrated supply sources.

Alongside international expansion, India must continue efforts to maximise domestic production through improved recovery from mature fields and selective development of deepwater and frontier resources. While recent policy measures aimed at improving licensing flexibility and fiscal terms are positive steps, significant production gains may take time to materialise.

Going forward, resilience rather than just cost efficiency will define the future of upstream energy investments. For India, building a diversified energy portfolio through both domestic production and global asset ownership will remain critical to navigating an increasingly uncertain geopolitical environment.