India’s Crude Oil Production Falls For 11th Straight Year, Gas Output Also Slips

Last Updated:April 23, 2026, 2:51 PM IST

Domestic crude production drops to 28 million tonnes in FY26, while natural gas output declines for second consecutive year; ageing fields and weak discoveries remain key concerns.

India’s crude oil production fell 2.5 per cent year-on-year to 28 million metric tonnes in FY26.

India’s dependence on imported energy increased further in 2025-26 as domestic crude oil production declined for the eleventh consecutive year, while natural gas output also registered a second straight annual fall.

The prolonged weakness in domestic production has lifted import reliance to 89 per cent for crude oil and 51 per cent for natural gas during the year, underlining India’s growing exposure to global supply shocks and price volatility.

The vulnerability became more visible during the US-Iran conflict, when sourcing cargoes turned difficult, refiners paid higher prices and shortages were reported in March.

Crude Output Continues Long Decline

According to data from the Ministry of Petroleum and Natural Gas, India’s crude oil production fell 2.5 per cent year-on-year to 28 million metric tonnes in FY26. The latest decline means crude output has fallen 22 per cent since FY15, when the current downtrend began.

A major reason behind the slide has been lower production from ageing oilfields, coupled with a lack of sizeable new discoveries that could offset depletion.

Natural Gas Output Also Weakens

Natural gas production declined 3.7 per cent to 34,776 million metric standard cubic metres (mmscm) in FY26. Over the longer term, domestic gas output has remained under pressure. Production dropped from 47,555 mmscm in FY12 to 28,672 mmscm in FY21.

Fresh fields commissioned in the same basin had pushed national gas output higher by 19 per cent in FY22. However, production from those assets has now stabilised, while falling output from mature ONGC-operated fields has continued to weigh on overall volumes.

Reforms Yet to Deliver Major Global Interest

Over the past several years, the government has introduced multiple reforms to encourage exploration and production. These include a national geological data repository, easier regulatory and environmental clearances, and revised fiscal terms aimed at improving returns for explorers.

Despite these measures, large global oil and gas companies have shown limited participation. Most licensing rounds over the past decade have continued to see domestic public sector firms take the lead, according to an ET report.

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