Often referred to as “Black Gold,” petroleum is a thick liquid that is found far below the surface. It is a fossil fuel that was created millions of years ago when microscopic marine life perished and deposited on the ocean floor. Their remnants eventually converted into oil due to pressure and heat. Crude oil can be found in the Indian states of Rajasthan, Gujarat, Assam, and offshore regions like the Mumbai High. Oil has become even more crucial, though, due to recent world events like the Israel-Iran conflict. The top oil-producing states and how they contribute to India’s electricity supply will be discussed in this article.
Once a desert state, Rajasthan is now one of India’s main petroleum hubs. Approximately 20–25% of the nation’s domestic crude oil is currently produced in the state. Large oil fields including Mangala, Bhagyam, and Aishwariya are located in the Barmer-Sanchor Basin in western Rajasthan, which contains the majority of this oil. In this area, the oil is found in sandstone layers that are located far below the surface. It originated from ancient organic material that was buried and subjected to extreme heat and pressure millions of years ago.
Companies like Cairn Oil & Gas (Vedanta) employ contemporary technologies to uncover this “Black Gold” today. The oil is transported from Barmer to refineries in Gujarat via the longest continuously heated pipeline in the world, which is over 700 kilometers long.
Nearly half of India’s total petroleum production still comes from offshore regions. The most productive is the Western Offshore, which employs cutting-edge platforms like Sagar Samrat and is headed by the renowned Mumbai High field.
Deep-water exploration is also increasing in the Krishna-Godavari Basin’s Eastern Offshore. To improve energy security, the government is accelerating deep-sea drilling through “Mission Samudra Manthan” in 2026.
- National Production: In the first half of FY26 (2025–2026), India produced 15.6 million metric tonnes (MMT) of crude oil, a 3.3% increase.
- Consumption: With more than 5.5 million barrels of oil consumed daily, India is the third-largest oil consumer in the world.
Import Reliance: India still imports more than 85% of its crude oil requirements to meet demand, despite Rajasthan’s strong production.
At the moment, Rajasthan is India’s biggest onshore producer of crude oil. It accounts for around 24% of all domestic production in the nation. The Barmer-Sanchor Basin, home to important fields including Mangala, Bhagyam, and Aishwariya, provides the majority of the state’s output.
Rajasthan (Barmer Basin), Gujarat (Cambay Basin), Assam (Brahmaputra Valley), Tamil Nadu (Cauvery Basin), and Andhra Pradesh (Krishna-Godavari Basin) are the five main states with substantial oil reserves. Rajasthan and Gujarat currently account for the majority of onshore volumes, although Assam has the oldest fields. Rajasthan, Gujarat, and Assam are the top three oil-producing states in India. Together, these states generate over 95% of the nation’s onshore crude oil. Rajasthan is the largest producer, with Gujarat’s fields in Mehsana and Ankleshwar close behind.Assam is home to the oldest oil field in both India and Asia. In 1889, the Tinsukia district’s Digboi Oil Field began producing oil on a commercial scale.
