On the morning of the 12^th of May 2019, commercial ships were attacked outside the port of Fujairah in United Arab Emirates (UAE). Reports of the incident first emerged in pro-Iranian media outlets in the region. They initially claimed that there were blasts in the Fujairah port which had damaged numerous ships. The port authorities denied the incident but later admitted that four ships were attacked by sabotage operations outside the port. The incident happened within the territorial waters of the UAE.

Ships attacked were Saudi Arabian oil tankers which were on their way to receive oil from the Saudi port of Ras Tanura. There were no casualties or injuries, although the ships themselves have sustained large-scale damage, according to reports. This is a worrying development for India which is dependent on oil from the Persian Gulf to the tune of 80 percent of its needs.

One third of the world`s oil passes through the Strait of Hormuz which is a vital maritime chokepoint connecting the Persian Gulf with the Gulf of Oman. Iran, Iraq, Quwait, Bahrain, Saudi Arabia, Qatar and UAE, all need the strategic strait to export their substantial petroleum resources. In fact, the disruption of maritime traffic in the region could lead to an economic crisis in the world. India is in a particularly vulnerable position as it has disproportionately high dependence on oil from the Gulf.
Tensions have been rising in the region since President Trump withdrew waivers from sanctions to eight countries for importing oil from Iran. The stated American aim is to reduce Iranian oil exports to zero. Teheran has warned that “If it could not export oil through the Strait of Hormuz, no one else would be able to do so either”. President Trump has reinforced the presence of the US forces in the region and has refused to rule out military action against Iran. There is significant geo-political friction in the Persian Gulf even without the US getting involved. The Gulf monarchies Saudi Arabia, United Arab Emirates and Bahrain view Iran as a hostile state which is seeking regional domination through its proxies. These could range from Hezbollah in the Levant, Houthis in Yemen to various para-military forces in Iraq. The root of this geo-political competition lies in the Sunni-Shiite sectarian nature of polities of the opposing states.

The hostility from the Gulf Cooperation Council (GCC) monarchies is reciprocated by Iran which views these countries as regressive and autocratic, and who suppress the Shiite minorities of their respective states. Their violent repression of the minorities is seen as evidence of this. These actions also raise public heat in Iran. The Gulf kingdoms, on the other hand, believe that Iran is instigating the Shiite minorities in the region to topple the monarchies.
The zero-sum game being played in the region has been put on a tinderbox after the recent American actions. The Fujairah incident only highlights the seriousness of the situation. The Gulf monarchies have stopped short of accusing Iran of being behind the sabotage attacks on the oil tankers. The United States has been more forthright and warned that “Iran or its proxies” could be targeting maritime traffic in the region.

Notwithstanding who was behind the attack, it is quite clear that the situation in the Persian Gulf is worsening by the day. India, which has vital stakes in the region, must remain alert to the developments. Moreover, it needs to put in place contingency plans if things go from bad to worse. After the removal of American waivers, India has stopped importing Iranian oil. However, its intake from the Gulf has remained the same as Delhi has shifted to buying more oil from other states in the region. This could be problematic in light of the Fujairah incident.

Fujairah is the only port in the UAE which lies on the Gulf of Oman. It bypasses the chokepoint of the Strait of Hormuz which could get shut in the case of armed conflict in the region. The sabotage attack outside the port is an indication that Fujairah is also not safe to maritime traffic, if tensions continue to rise. Therefore, it becomes pertinent for India to find alternate supplies of oil for its industries. The country is already buying record amount of oil directly from the US which has become the largest producer of oil in the world in last couple of years. However, limitations in the US infrastructure constrict this partnership. India is also the largest consumer of Nigerian oil. India must seek to increase its oil take from countries in Africa like Angola and Nigeria. It must also seek to import more oil from Russia and Canada which are the 3^rd and 4^rd largest producers of oil in the world.

Besides, the conflict in the Persian Gulf, if it happens, would also raise the price of petroleum in the world market. That would have a negative effect on the Indian economy. Delhi must therefore brace itself for the coming financial challenges. A new government will come to power after the present elections by the end of this month. The initial days should give the government enough leeway to take hard decisions for the country. The belt tightening will help to tide over the problems in the Gulf. However, shifting away from its addiction to Gulf oil must be the long-term plan for the country.

(Rajesh Soami is an Associate Fellow at National Maritime Foundation, New Delhi)

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