India’s crude oil import bill surged 56.5% year-on-year to $63.4 billion during April-July FY27, driven mainly by higher international crude prices amid the ongoing West Asia conflict. 

Import volumes remained broadly stable at 81.9 million tonnes, compared with 81.5 million tonnes a year earlier, showing that the sharp increase in the bill was largely price-driven.

The rise comes as crude prices have remained elevated because of disruptions to oil supplies and shipping routes in the region. Renewed tensions around the Strait of Hormuz, a critical route for global energy supplies, have pushed Brent crude to around $91.5 a barrel on August 19, after prices had briefly declined following an earlier ceasefire.

The impact on India’s import bill has been particularly visible in the price of the Indian crude basket. In April, the average price rose to $114.48 a barrel, compared with $67.70 a barrel in April 2025. In July, the average import price stood at $82.04 a barrel, up from $70.90 a year earlier.

July alone saw India’s crude import bill rise 41% to $13.7 billion. Crude import volumes also increased 13.2% to 21.4 million tonnes during the month, compared with 18.9 million tonnes in July last year. This combination of higher prices and increased volumes added further pressure on India’s external trade position.

India is particularly exposed to movements in global oil prices because it meets more than 85% of its crude oil requirement through imports. 

The country imports around 1.8-2 billion barrels of crude every year, meaning every $1 increase in the price of a barrel can raise India’s annual oil import bill by as much as $2 billion.

The higher oil bill is also putting pressure on India’s trade balance and current account. India’s merchandise trade deficit widened to a six-month high of $31.98 billion in July, with the oil import bill remaining elevated despite a month-on-month decline in oil import value. 

Higher energy costs can also put pressure on the rupee and increase inflation risks if elevated crude prices persist.

India has attempted to diversify its crude supply sources. Russia accounted for a record 50.83% of India’s crude imports in July, as Indian refiners increased purchases of Russian oil amid disruptions to Middle Eastern supplies. 

However, potential US measures targeting buyers of Russian crude could create another layer of uncertainty for India’s energy procurement strategy.

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