India is bracing for a perfect storm of energy challenges as summer heat collides with a global oil shock. Peak power demand is projected to hit a record 270 GW this summer, surpassing last year's peak of 250 GW, while simultaneously grappling with severe disruptions to oil and LPG supplies from the Middle East.

According to , India's electricity demand is expected to surge due to increased cooling requirements across the country during extreme heat conditions. This spike in demand comes at a particularly vulnerable time, as reports that India imports 60% of its natural gas and over 90% of LPG from the Middle East, making it highly susceptible to supply disruptions.

The Strait of Hormuz closure has created a cascading effect on India's economy. notes that India's fuel consumption surged to 21.37 million tons in March, the highest in over a decade, while LPG consumption dropped significantly due to supply constraints. This has forced the Indian government to prioritize household cooking gas over commercial and industrial use.

The economic implications are substantial. GDP growth forecasts have been revised downward, with Standard Chartered lowering India's growth forecast to 6.4% from 7% for FY 2027. The Indian rupee has hit record lows, declining nearly 10% against the US dollar in the past year. For deeper insights into how energy shocks impact emerging economies, the Reserve Bank of India has been actively monitoring these developments and their macroeconomic implications.

However, India has some advantages. Higher coal stocks and increased renewable capacity—which now contributes over 50% of installed capacity—position the country better to manage rising electricity demand. State governments play a critical role in demand management and grid readiness during peak summer months. The challenge ahead will be balancing record cooling demand with constrained energy supplies while maintaining economic stability.