Indian Crude Oil Basket Surges to $128.7 per Barrel Amid Geopolitical Disruptions

The Indian crude oil basket has surged nearly 30% to $128.7 a barrel, raising concerns about higher import bills and inflation. Brent crude futures rose slightly on Tuesday after touching a session high of $108.43.

This significant increase in crude prices is likely to widen the current account deficit and affect India's fiscal position. The country has around 74 days of total fuel reserves, limiting the immediate risk of physical shortages.

Analysts warn that if crude remains near $130 a barrel for two-three quarters, it could pull FY27 growth down to 6.4%, push inflation to 5.5%, and widen the current account deficit to around 3.2% of GDP.