$90 Oil Could Lift India’s Inflation to 4.8% and Slow GDP Growth
$90 Oil Could Lift India’s Inflation to 4.8% and Slow GDP Growth What I Cover Tsvetana Paraskova is an energy and commodities journalist who has contributed to Oilprice.com for nearly a decade, covering global energy markets, commodities,… India’s inflation is set to accelerate to 4.8% in the fiscal year 2027, if oil prices average $90 per barrel through March next year, Indian wealth and asset manager 360 ONE Capital said in a report on Tuesday.
“Our revised base case assumes de-escalation by mid-June, with crude oil averaging $90/bbl in FY27,” the asset manager said, as carried byIndian media.
Under this scenario, consumer prices are set to rise to 4.8% while GDP growth would moderate to 6.3% from 6.7% previously expected, according to 360 ONE Capital, which also sees widening fiscal and current account deficits amid the surge in oil prices.
“A further $10/bbl increase in crude prices above our base assumption could push inflation to 5.6 per cent (assuming a partial pass-through of around 5 per cent to retail fuel prices), lower GDP growth by an additional 40 bps to 5.9 per cent, widen the current account deficit to 2.5 per cent GDP, and increase the fiscal deficit to 4.8 per cent of GDP,” analysts at 360 ONE Capital wrote in the report.
In India, the world’s third-biggest crude oil importer, inflationaccelerated in Aprilas the higher global oil and gas prices started to feed through to consumer prices.
India’s economy remains resilient to the external shocks, but the oil price surge amid the global supply disruption poses near-term downsiderisks to economic growthand upside risks to inflation, the Reserve Bank of India (RBI) said last week.
Assuming that the adverse impact of the Middle East conflict would remain contained in the near term, India’s real GDP growth for 2026-27, ending March 2027, is projected at 6.9% with risks tilted to the downside, the central banksaidin its Annual Report for 2025-26.
In the 2025-2026 fiscal year, India remained the world’s fastest-growing major economy, expanding at 7.6%, with headline inflation at 2.1%, the central bank said.
"However, the evolving upside risks to inflation may emanate from multiple other factors such as a spike in global fuel and commodity prices amid geopolitical tensions, potential spillovers to input and wage costs, and volatility in exchange rate," the bank’s analysts noted.
“Considering all these factors, CPI inflation for 2026-27 is projected at 4.6 per cent with risks tilted to the upside,” they said.
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| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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