It’s been a wild week in the global oil market, with prices shooting up on the back of fresh hostilities between the US and Iran. Brent crude rallied around 8% last week and West Texas Intermediate (WTI) jumped nearly 10%, as both nations resumed attacks, including US strikes on three Iranian oil tankers near the Strait of Hormuz over the weekend. The conflict is reverberating far beyond the Middle East, sending oil prices—and import bills—soaring worldwide.
India, one of the world’s largest crude importers, is feeling the heat directly. According to data from the Petroleum Planning and Analysis Cell (PPAC) of India’s Oil Ministry, the Indian Basket of crude oil—a blend of sweet and sour grades—surged to $101.07 per barrel on Friday. This marks the first time since May that prices have punched through the $100 threshold. The upward trend hasn’t let up: as of Monday, the average Indian Basket price for September sat at $99.38 a barrel, a steep climb from $83 in June and $82 in July.
Soaring Import Bills and Market Volatility
The impact on India’s economy is already visible. The July crude import bill was a whopping 41% higher than the same period last year, a direct consequence of the price rally driven by reduced oil supplies and swelling geopolitical tensions. Priyanka Sachdeva, head of market insights at Phillip Nova, noted, “The current roundup indicates a slightly more dire picture than the last time we took stock a few weeks ago.” She pointed out that nations have been forced to burn through stockpiles to stave off supply deficits.
Financial markets are bracing for more volatility as traders weigh several factors: the ongoing US-Iran standoff, persistently tight Middle East supplies, and the US Federal Reserve’s increasingly hawkish stance, which could mean an interest rate hike as soon as this month. Analysts from ANZ have now lifted their short-term Brent forecast to $95 a barrel, warning that prices could surge even higher if the Middle East conflict drags on.
What’s Next for Oil Prices?
Looking ahead, the market is poised for a choppy ride. The expected trading range for crude is now between $69.92 and $102.18, with risk factors including possible spikes in US commercial inventories, surprise OPEC+ production increases, or sudden shifts in global economic data. For now, though, the direction is clear: as long as conflict disrupts Middle East flows, oil prices—and India’s import bills—are likely to stay uncomfortably high.
