Industry Odisha Bureau, Oct 28: India’s crude oil import basket has topped $120 a barrel amid the West Asia war. The basket averaged $120.46 a barrel through October 26, The Hindu BusinessLine reported. That is the highest monthly average in 14 years, since March 2012’s $123.61. On October 26 alone, the basket price touched $123.72.
The October figure is a month-to-date average, not a completed monthly number. It compares with $116.77 in September, a rise of about 3.2%. Against August’s $90.19, the jump is roughly 33.6%. The single-day $123.72 quote is not directly comparable with monthly averages.
The West Asia conflict has raised uncertainty across global oil markets. Risk alone can lift costs, even without confirmed physical supply cuts. Higher war-risk insurance premiums and record freight rates add to delivered crude costs. On Tuesday evening, Brent traded at $114.60 a barrel. WTI stood at $100.90, while Murban was at $117.70. The report said global crude prices have risen roughly 80% in 2026.
Buying patterns are shifting too. Equirus Securities noted that almost all cargoes are now bought on a delivered basis. Earlier, only about half were bought that way. Under delivered terms, sellers arrange shipping, though transport costs still feed into prices.
Costlier energy is swelling India’s import bill. Net oil and gas imports rose 35% year-on-year to $81.1 billion in April-September. Net imports subtract petroleum product exports from gross crude, product and LNG imports. ICRA estimates a $10 rise in average crude adds $12-13 billion to yearly net imports. That would widen the current account deficit by about 0.3% of GDP. This is a sensitivity estimate, not a confirmed outcome.
The rupee is also under strain. It traded near 95.08 per dollar on Tuesday, with the Dollar Index near 101.50. Higher oil payments raise demand for dollars, pressuring the currency. A weaker rupee, in turn, makes imported crude costlier in local terms. LKP Securities’ Jateen Trivedi expects the rupee to stay sensitive to crude and dollar trends. He sees 95 as a key support level. The current account deficit widened to $11.2 billion in April-July, from $6.6 billion.
State-run fuel retailers face pressure as well. LPG under-recoveries across the three public sector oil marketing companies are about ₹62,000 crore. Under-recoveries arise when selling prices fall short of supply costs. HPCL and BPCL’s September-quarter results showed squeezed marketing margins. Stronger refining margins partly offset that pressure. Indian Oil is due to report results on Friday.
Sustained high prices could feed into transport costs, inflation and corporate earnings. Much depends on how long the conflict and freight disruptions last. Domestic fuel pricing decisions will also shape the final impact. For now, India faces a costly mix of pricey crude, shipping and a weak rupee.
