India Oil And Gas Upstream - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2026 - 2031)

India Oil And Gas Upstream Market Analysis

The India Oil And Gas Upstream Market is expected to grow from USD 16.08 billion in 2025 to USD 16.87 billion in 2026 and is forecast to reach USD 21.47 billion by 2031 at 4.94% CAGR over 2026-2031.

Strong policy support, digital oilfield rollouts, and enhanced oil recovery (EOR) projects offset the drag from geological complexity, enabling operators to extract additional barrels from maturing assets and thereby slowing import growth. Capital is shifting toward deepwater prospects, where large discoveries can be tied back to existing infrastructure, while a wave of decommissioning contracts emerges as India’s first generation of offshore platforms nears the end of their life. Private companies introduce agile drilling and completion technologies, yet state-owned enterprises retain strategic control through acreage holdings and legacy infrastructure. Supply-chain bottlenecks in rigs, proppants, and subsea equipment remain the principal operational headwinds but are gradually easing as domestic manufacturing expands under “Make in India” mandates.

India Oil And Gas Upstream Market Trends and Insights

Declining Domestic Output Spurring EOR Investments

National oil output fell from 36 million tonnes in FY2017 to 29.4 million tonnes in FY2024, creating a clear incentive for operators to deploy ASP, polymer, and miscible-gas flooding in mature reservoirs. Cairn Oil & Gas has earmarked USD 1 billion to retrofit its Rajasthan fields with full-field ASP, targeting a 15-20% uplift in recovery factors as per its April 2025 shareholder presentation. Pilot programs in Assam’s Lakwa and Gujarat’s Kalol fields recorded incremental gains of 4,000–6,000 barrels per day, demonstrating replicable gains across India’s 430 mature fields. Operators now view EOR as a margin-accretive alternative to risky frontier exploration because most surface facilities are already in place, shortening payback periods to under four years.

Expansion of OALP Bid Rounds & HELP Incentives

The Hydrocarbon Exploration & Licensing Policy (HELP) has transitioned India from a cost-recovery production-sharing regime to a transparent revenue-sharing system, thereby eliminating audit disputes while granting full marketing freedom for gas. Since 2018, nine OALP rounds have cumulatively awarded 134 blocks and attracted work-program commitments worth USD 1.37 billion, according to the Directorate General of Hydrocarbons. Major industry players, such as BP and Eni, have pre-qualified for the upcoming Round X, enticed by unified license terms that cover both conventional and unconventional resources. The open-acreage model allows bidders to carve out prospect-specific polygons instead of waiting for government-curated bid maps, thereby accelerating acreage acquisition cycles.

Geological Complexity of Mature Onshore Basins

Reservoir heterogeneity in Rajasthan’s Barmer-Hill and Assam’s fractured carbonates requires multi-stage hydraulic fracturing and high-density vertical logging, which doubles drilling costs compared to vintage wells. The Directorate General of Hydrocarbons lists more than 60 prospects with permeability below 1 mD, classifying them as tight oil. Reservoir-quality uncertainty elevates failure risk and forces operators to pre-commit completion hardware while drilling, tying up capital and inflating field-level break-evens. Water sourcing for frac jobs also raises environmental scrutiny in arid districts such as Jaisalmer.

Other drivers and restraints analyzed in the detailed report include:

1. Gas-Price Indexation Reforms Improving Project Economics
2. Digital-Oilfield Adoption Led by Indian IT Majors
3. Prolonged Environmental & Land-Acquisition Approvals

For complete list of drivers and restraints, kindly check the Table Of Contents.

Segment Analysis

Offshore fields delivered 46.22% of 2025 revenue, yet they are set to outpace onshore operations with a 6.32% CAGR through 2031 as deepwater tie-backs shorten payback periods. The India oil & gas upstream market size derived from offshore alone is projected to grow from USD 7.43 billion in 2025 to USD 10.73 billion by 2031. Meanwhile, the onshore domain, although still larger, faces a plateauing output at a 3.56% CAGR because most low-hanging resources have already been drained.

The offshore growth narrative is based on ONGC’s KG-DWN-98/2 cluster, Reliance-BP’s MJ and Satellite developments, and the collaboration between Oil India and Petrobras in the Mahanadi Basin. Sub-sea boosting, multiphase pumping, and long-tie-back pipelines reduce unit lifting costs, even in water depths exceeding 1,500 meters. Decommissioning of the Panna-Mukta-Tapti platforms also demonstrates the regulator’s capacity to manage late-life liabilities, encouraging new entrants wary of end-of-life obligations. Onshore opportunities remain attractive where mature infrastructure exists; however, stringent water-use restrictions and land-access delays can dilute near-term growth.

Crude oil retained a 67.45% revenue share in 2025; however, natural-gas-linked revenue is expected to capture 34.80% by 2031 as gas output increases to meet the national goal of a 15% primary-energy share. Gas-rich blocks licensed under HELP contribute to an India oil & gas upstream market size of USD 5.23 billion in 2025 for gas, expanding at a 6.88% CAGR. This acceleration outpaces oil, which grows at 4.18%, mirroring policy incentives and lower carbon intensity.

Enabling infrastructure, including the National Gas Grid extension and 295 new CNG stations, creates offtake certainty. Gas producers enjoy marketing freedom for volumes up to 6 Tcf discovered post-2016, shielding returns from legacy price caps. Conversely, oil-focused assets rely on EOR spending to stem declines, adding cost layers that curb margin upside. Associated-gas monetization remains an under-exploited lever; ONGC’s Mumbai High flare-back project alone could contribute 0.4 Bcf/d once completed, reinforcing balanced oil-gas portfolios.

The India Oil and Gas Upstream Market Report is Segmented by Location of Deployment (Onshore and Offshore), Resource Type (Crude Oil and Natural Gas), Well Type (Conventional and Unconventional), and Service (Exploration, Development and Production, and Decommissioning). The Market Sizes and Forecasts are Provided in Terms of Value (USD).

List of Companies Covered in this Report:

1. Oil & Natural Gas Corporation
2. Oil India Ltd
3. Vedanta Ltd (Cairn O&G)
4. Reliance Industries
5. BP plc
6. Hindustan Oil Exploration Co.
7. Bharat PetroResources Ltd
8. Essar Oil & Gas Exploration
9. Adani Welspun Exploration
10. Sun Petrochemicals
11. GAIL (E&P)
12. Shell India (BG Exploration)
13. Joshi Technologies Int’l
14. Deep Industries Ltd
15. Jindal Drilling & Industries
16. Larsen & Toubro Ltd (L&T)
17. Hindustan Construction Co.
18. Halliburton India
19. Schlumberger India
20. Baker Hughes India

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support