New Delhi, Mar 9 (UNI) The impact of global crude price rise on inflation is not estimated to be substantial at this point as India’s inflation is near the lower bound, the Lok Sabha was informed on Monday.
In reply to a written reply, Finance Minister Nirmala Sitharaman said the price of both global crude oil and the Indian basket has been on a declining trajectory for the past one year, till the geo-political clashes commenced in West Asia on February 28, 2026.
“Between the end of February and until March 2, 2026, the Crude Oil FOB Price (Indian Basket) rose from USD 69.01/barrel to USD 80.16/barrel. Given that India’s inflation is near the lower bound, the impact on inflation is not estimated to be substantial at this point,” she said.
The minister further said that RBI’s Monetary Policy Report in October 2025, had estimated that if crude oil prices are higher by 10pc than the baseline assumptions, and assuming full pass-through to domestic prices, inflation could turn out to be higher by 30 basis points.
Notably, the crude prices have been rising since February 28 when the US and Israel launched military strikes on Iran, which retaliated with attacks on US positions in the region, as well as Israel.
In a research note, UBS Global Research said India’s state-owned oil marketing companies (OMCs) could face mounting earnings pressure as crude oil market volatility intensifies amid escalating geopolitical tensions in West Asia.
The brokerage warned that the recent rally in crude oil prices and refining margins is creating conditions reminiscent of the disruptions witnessed during the 2022 oil market shock. It noted that Indian OMCs remain structurally vulnerable to higher crude prices because a significant portion of their profitability depends on fuel marketing margins.
