New Delhi, March 27, 2026 — Brent crude traded at $101.63 per barrel on Friday, keeping India’s monthly crude import bill well above $15 billion and pushing input costs higher across chemicals, plastics, fertilisers, and road transport. Prices peaked at $110.96 per barrel on March 20 before easing slightly, but analysts at Goodreturns and TradingEconomics warn that the US-Iran standoff keeps supply risk elevated through at least April 6.
What Is Happening Globally
US President Donald Trump and Israel launched strikes against Iran on February 28, triggering sweeping Iranian retaliation and fears of a Strait of Hormuz closure. Brent crude jumped from roughly $70 per barrel at end-February to a high of $110.96 on March 20, a 58 percent surge in three weeks. Prices pulled back to $96.07 on March 23 after Trump extended the Hormuz deadline to April 6, but surged again to above $101 by March 27 as de-escalation hopes faded. The 10-year US Treasury yield climbed above 4.4 percent, signalling broader macro stress in global financial markets.
India’s Direct Exposure
India imports about 85 percent of its crude requirements, making it one of the world’s most exposed economies to oil price volatility. At $101 per barrel, the country’s annualised crude import bill rises by an estimated $40 to $50 billion compared to a $70 baseline, widening the current account deficit sharply. Indian Oil, BPCL, and HPCL face combined under-recoveries of roughly Rs 24 per litre on petrol and Rs 30 per litre on diesel. Manufacturers relying on naphtha, propylene, and other petrochemical feedstocks from GAIL and Reliance Industries have seen raw material costs rise 20 to 30 percent since February. The Sensex fell 1,102 points to 74,171 on Friday, with PSU banks and media stocks declining over 3 percent each.
The Bigger Picture
India has navigated oil shocks before, using excise duty cuts and OMC subsidy mechanisms to contain pump price inflation, but the February-to-March 2026 episode is notable for the speed of the price move. The government’s Rs 1.55 lakh crore annual fiscal hit from Thursday’s excise duty cut is a direct consequence of being caught between frozen retail prices and a geopolitical oil shock that no domestic policy can fully absorb. If the Hormuz reopens cleanly after April 6, crude could retreat to the $80 to $85 range, restoring some relief for manufacturers and importers. If the conflict persists, India faces a sustained squeeze on trade balances, industrial margins, and the rupee.
Industrial Front Desk
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