India’s crude basket price tops $120 a barrel amid West Asia war

India’s average crude oil import basket price rose by almost 4 per cent month-on-month (M-o-M) in October to surpass the $120 per barrel mark as the conflict in West Asia exacerbated geopolitical uncertainty and pushed up marine insurance premiums and freight rates.

The average crude oil price for Indian basket stood at $120.46 per barrel till October 26, against $116.77 per barrel in September and $90.19 a barrel in August 2026. The current October monthly average price is the highest in 14 years since March 2012 ($123.61 per barrel).

The crude oil Indian basket price on October 26 stood at $123.72 a barrel.

Meanwhile, global crude oil prices are also on the higher side, rising by roughly 80 per cent in 2026. On Tuesday evening, Brent was ruling at $114.6 a barrel. The WTI and Murban grades were trading at $100.9 a barrel and $117.7, respectively.

Under-recoveries

Besides, the under-recoveries on LPG for the three PSU OMCs are around ₹62,000 crore. The Q2 FY27 results of HPCL and BPCL also reflect pressure on marketing margins, which is partially offset by high refinery margins. Indian Oil is scheduled to present its results on Friday.

Analysts and refiners pointed out that record high shipping freight rates and high marine insurance premiums are adding more volatility to high crude oil prices. Coupled with a weak Rupee against the US dollar is further inflating the bill besides pushing up the current account deficit (CAD).

India’s net oil and gas import bill rose by 35 per cent Y-o-Y to $81.1 billion during April-September in FY27.

Jateen Trivedi, VP Research Analyst for Commodity and Currency at LKP Securities, said rupee traded with minor gains of around 9 paise at 95.08 (Tuesday), finding support near the 95 level despite crude oil prices hovering around $115 and the Dollar Index near 101.50.

Challenge to rupee

“Elevated crude prices continue to pose a challenge for the domestic currency, while market participants remain cautious ahead of the US Federal Reserve’s policy outcome tomorrow night. Going ahead, the rupee is likely to remain sensitive to crude oil movements and global dollar trends, with the 95 level acting as an important support zone,” Trivedi anticipated.

As per ICRA, a $10 per barrel uptick in the average crude oil price for the fiscal pushes up the net oil imports by around $12-13 billion during the year, thereby enlarging the CAD by 0.3 per cent of GDP. India’s CAD has risen to $11.2 billion during April-July in FY27 against $6.6 billion a year-ago.

Equirus Securities in a commentary on HPCL’s Q2 FY27 results recently noted that crude oil sourcing remains highly volatile, and almost all cargoes are now bought on a delivered basis versus about half earlier

Published on October 27, 2026