Oil is the most essential fuel for the world presently and the world, India is the third largest oil importer in the world, with 9.7 percent of the world oil imports, after China and USA, India imports around 80 percent of its oil needs and aims to bring down to 67 percent by 2022, by replacing it by local exploration, renewable energy and indigenous ethanol fuel, but in India there is lack of demand for crude oil and oil products due to Covid-19 epidemic, which made Indian government to imply restrictions, to lockdown of various firms, industries, public and private sector institutions, as health emergency, according to the report of IEA ( International Energy Agency) India’s 40 days lockdown has led to decrease in 30 percent fall in countries demand for energy. Price inflexibility is concern for Indian oil producers, as it is the biggest shock since the Second World War, The global economy is expected to enter recessionary zone in 2020, as countries have shut down there normal business activities, to fight the pandemic led to imbalances in demand and supply of oil prices in the Indian market, Indian oil companies are waiting for the tax reductions and packages by the government, in the short term imbalance in oil demand and supply situation. The purpose of the research paper is that, Indian government has a great task to fight against pandemic as a health emergency and oil prices fluctuations in the year 2020.