India’s energy woes amid Trump’s conflicting claims, Iran’s denials, and Pakistan’s mediation gambit

As the world’s third largest oil importer, the West Asian conflict has laid bare the fragility of India’s supply chains and underscored the constraints on its foreign policy autonomy

MT Nanda Devi at Vadinar port - Deendayal Port Authority LPG carrier MT Nanda Devi at Vadinar port in Gujarat | Deendayal Port Authority

The war in Iran has become a stage for competing narratives, where military escalation intertwines with political theatre and diplomatic manoeuvring. At the centre of this drama is US President Donald Trump, whose unpredictable statements have left allies, adversaries, and global markets in a state of confusion. His weekend ultimatum demanding Iran reopen the Strait of Hormuz within 48 hours or face strikes on its power plants was followed by a sudden announcement of a five day pause in planned attacks. This oscillation between threats and gestures of de escalation has deepened uncertainty, with analysts suggesting Trump may be searching for an “exit ramp” from a war that has proven domestically unpopular and economically damaging.

Iran, however, has firmly rejected Trump’s claims of ongoing negotiations. Senior officials, including members of the Islamic Revolutionary Guard Corps (IRGC), dismissed his statements as “fake news” and accused Washington of fabricating dialogue to manipulate oil prices and buy time for military planning. Esmaeil Kowsari, a parliamentarian and military figure, warned that such tactics were designed to create division among Iranians and foster scepticism toward their leadership. Tehran’s denials underscore its determination not to appear as though it is bowing to US pressure, even as the conflict stretches into its fourth week.

Vaishali Basu Sharma Vaishali Basu Sharma

Yet, behind the public denials, regional powers have begun exploring diplomatic channels. Reports suggest that foreign ministers from Egypt, Turkey, Saudi Arabia, and Pakistan met in Riyadh to discuss a possible off-ramp. Egyptian intelligence officials reportedly opened a backchannel with the IRGC, proposing a temporary halt in hostilities to build confidence towards a broader ceasefire. These developments highlight the contrast between the public rhetoric of confrontation and the quiet efforts of regional actors to prevent the war from spiralling further.

Talks are being held among Egyptian Foreign Minister Badr Abdelatty, Pakistani Foreign Minister Ishaq Dar, Turkish Foreign Minister Hakan Fidan, Qatari Prime Minister and Foreign Minister Sheikh Mohammed bin Abdulrahman Al Thani, Iranian Foreign Minister Abbas Araghchi, and US Special Envoy for the Middle East Steve Witkoff. The breadth of these contacts underscores the urgency felt across the region, as multiple capitals attempt to position themselves as credible interlocutors in a conflict that has already destabilised energy markets and heightened geopolitical tensions.

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Pakistan has emerged as a particularly active player in this diplomatic theatre. Field Marshal Asim Munir and Prime Minister Shehbaz Sharif have engaged both Saudi and Iranian leaderships, positioning Islamabad as a potential venue for talks. Pakistan’s involvement is driven by the precarious position in which it finds itself. A defence pact signed with Saudi Arabia last year obliges Pakistan to act if its strategic partner is attacked, effectively tying Islamabad’s fate to Riyadh’s confrontation with Tehran. This has created a nightmare scenario for Pakistan, which shares geographic ties with Iran but cannot afford to alienate Saudi Arabia, one of its largest donors. Munir’s controversial remarks to Shia clerics, telling them to “go to Iran” if they loved it so much, have sparked domestic backlash, exposing the internal strains of Pakistan’s balancing act.

Israel, meanwhile, has expressed frustration at Trump’s apparent willingness to explore negotiations. Analysts suggest that Prime Minister Netanyahu may have oversold the prospects of a quick victory and regime change in Iran, leaving Trump searching for a way out. Israeli officials fear that Washington’s pursuit of talks undermines their own strategy of entrenching US involvement in the conflict, and the lack of consultation has been interpreted as a rebuke of Netanyahu’s influence.

India finds itself deeply affected by the economic fallout. The disruption of fuel supplies has hit the country hard, with shortages of LPG and piped natural gas leaving factories idle, households struggling, and output slashed by nearly half. In an attempt to ease global energy disruption, the Trump administration issued a third, 30 day sanctions waiver allowing the purchase of Iranian oil already at sea. These waivers are designed to permit limited transactions without formally lifting sanctions, essentially buying time for refiners to secure cargoes already en route. Yet, India’s state run refiners have hesitated to act on them, citing unresolved issues around payments, shipping insurance, and the risk of secondary sanctions. By contrast, Russian barrels covered under earlier waivers have been snapped up more readily, thanks to established logistics and trade lines. The shortage of LPG, a fuel essential for cooking in millions of households, has underscored the vulnerability of India’s energy security to external shocks, while the lack of clear government guidance has left refiners to navigate this volatile environment largely on their own.

The opposition has seized on the crisis, accusing Prime Minister Narendra Modi of compromising India’s foreign policy by aligning too closely with US and Israeli interests. Rahul Gandhi, speaking in the Lok Sabha, charged that Modi “only does what America and Israel want him to do,” arguing that India’s foreign policy has been subordinated to external powers. Addressing the Lok Sabha, Modi acknowledged the seriousness of the crisis, warning that prolonged conflict could have grave consequences for India’s economy. He has pledged to secure alternative energy supplies and cushion the domestic impact.

As the world’s third largest oil importer, the West Asian conflict has laid bare the fragility of India’s supply chains and underscored the constraints on its foreign policy autonomy. Trump’s shifting rhetoric reflects both the domestic unpopularity of the war in the United States and the broader economic disruption it has triggered globally. Iran’s denials are aimed at preserving its image of defiance, while Pakistan seeks to broker a diplomatic solution that safeguards its own strategic interests. Whether the tentative diplomatic talks, be it in Cairo, Muscat, Doha, or Islamabad, will evolve into meaningful de escalation remains uncertain. For the moment, India must navigate a highly volatile landscape in which energy security, foreign policy independence, and domestic stability are simultaneously imperilled.