Global crude oil prices have surged to the $110-per-barrel mark as escalating geopolitical tensions and uncertainty over supplies fuelled fresh buying.
The rally could add to India's oil import expenses at a time when the country remains heavily dependent on overseas supplies to meet its energy requirements. Brent crude gained 3.7 per cent, recording its second consecutive weekly advance as concerns over attacks on energy infrastructure in the Middle East and Russia-Ukraine conflict intensified. Traders are increasingly factoring in the possibility of further disruptions, even as crude shipments through the strategically important Strait of Hormuz have recovered towards pre-war levels. India's crude oil basket has also remained elevated. According to the data provided, the Indian Basket averaged $122.01 per barrel in October 2026, compared with $116.09 in September. The October figure is the average for the month so far, while the Indian Basket was quoted at $119.39 per barrel as of October 15. Indian Crude Basket: October Average Climbs Above $122 The Indian Basket of Crude Oil is a composite benchmark reflecting the crude grades imported by Indian refineries. It combines Brent Dated, representing the sweet crude component, with an average of Oman and Dubai crude prices, representing the sour crude component. The monthly figures provided for 2026-27 show a sharp recovery in prices after a mid-year decline:
- April: $114.48 per barrel
- May: $106.23 per barrel
- June: $83.22 per barrel
- July: $82.04 per barrel
- August: $90.19 per barrel
- September: $116.09 per barrel
- October: $122.01 per barrel (average so far)
The latest price of $119.39 per barrel on October 15 was below the October average of $122.01, although both figures indicate that crude costs remain substantially above the mid-year lows.
Middle East Tensions And Russian Energy Disruptions Drive Prices
The global oil market has been reacting to renewed concerns about the security of energy supplies. Iran-backed Houthi rebels have continued missile and drone attacks targeting Saudi Arabia, while Russia and Ukraine have exchanged strikes on energy infrastructure.
The possibility of further escalation in the Persian Gulf has added to uncertainty around future supplies. Eurasia Group analysts raised their probability of an intensification in the conflict to 65 per cent, from 35 per cent, in a note.
“The conflict is likely to escalate,” Eurasia Group analysts wrote in a note, raising their odds of intensification to 65 per cent from 35 per cent. “The standoff status quo is no longer sustainable for the US.”
The US has also attempted to ease pressure on energy prices through emergency stockpiles. On Friday, it offered up to 17 million barrels from its Strategic Petroleum Reserve.
However, uncertainty persists over the availability of Russian diesel and the potential impact of continued attacks on refining facilities. US lawmakers introduced legislation to block a proposed arrangement involving the release of several hundred million barrels of diesel by Russia.
“After a brief reprieve, the oil market is having to price risk back in, particularly heading into the weekend,” said Rebecca Babin, senior energy trader at CIBC Private Wealth Group.
India Impact: Higher Crude Prices Could Raise Import Costs
For India, the sustained increase in crude prices carries implications for the country's import bill, trade balance and inflation outlook. As a major importer of crude oil, India is exposed to fluctuations in international prices, with higher costs potentially increasing the amount of foreign exchange required to purchase energy.
If elevated prices persist, the additional burden could put pressure on India's current account and the rupee. The eventual impact on consumers would depend on domestic fuel pricing decisions, government tax policies and how oil companies manage changes in input costs.
Higher crude prices can also increase expenses for industries that rely on petroleum products, including aviation, transportation, logistics and manufacturing. These costs may feed into prices across the economy if companies pass on a portion of the increase to customers.
The October Indian Basket average of $122.01 per barrel is therefore an important indicator to watch. However, the monthly average and the price on a particular date measure different things and should not be treated as interchangeable.
Oil Market Faces Further Uncertainty
Crude prices have gained more than 75 per cent this year, according to the report, as conflicts in the Middle East and Russia have disrupted energy supplies. Refined products have also recorded significant gains, with European diesel futures more than doubling over the year.
The market remains sensitive to developments affecting physical supply, shipping costs and expectations of further geopolitical escalation. Although crude flows through the Strait of Hormuz have improved, traders remain concerned that renewed hostilities could quickly alter the supply outlook.
For India, the trajectory of the Indian Basket in the coming weeks will be crucial. A sustained rise could increase the country's oil import expenditure and add to economic pressures, while any easing in geopolitical tensions or improvement in supply availability could help moderate prices.
