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India's dependence on imported crude oil is becoming increasingly costly as international prices climb, with Brent crude crossing the $100-per-barrel mark amid escalating tensions between the US and Iran.

The impact is already visible in the country's oil import bill. India's crude oil import bill rose 56.5 per cent to $63.4 billion during the April-July period of financial year 2026-27, even though the volume of crude imported remained largely unchanged from a year earlier, according to data from the Petroleum Planning and Analysis Cell (PPAC) under the oil ministry, reported Business Standard.

For India's oil marketing companies (OMCs), the rise in crude prices is also squeezing fuel marketing margins as petrol and diesel prices at the pump remain unchanged.

India Imports Nearly 90% Of Its Crude

India is among the world's largest crude oil importers and sources nearly 90 per cent of its crude oil requirements from overseas markets. It also imports around half of its natural gas requirements.

During April-July FY27, India imported 81.9 million tonnes (mt) of crude oil, compared with 81.5 mt during the same period in the previous financial year.

Despite the broadly stable import volumes, the higher price of crude pushed the import bill to $63.4 billion. The net oil and gas import bill also increased 40.3 per cent to $57.8 billion during the period.

The latest rise in crude prices could therefore add further pressure to India's energy import costs if international prices remain elevated.

OMCs Losing Money On Petrol And Diesel

The increase in crude prices is also affecting the economics of selling petrol and diesel in the domestic market.

Prashant Vasisht, senior vice-president and co-group head, corporate ratings at Icra, said OMCs were seeing negative marketing margins of around Rs 5 per litre on petrol and Rs 23 per litre on diesel, based on the average crude price for September so far.

He also estimated under-recoveries on domestic LPG at around Rs 200 per cylinder.

The pressure has emerged as international crude prices have risen while retail fuel prices have remained frozen.

The government had raised petrol prices by a cumulative Rs 7.35 per litre and diesel prices by Rs 7.53 per litre in May, with the increases implemented through four instalments.

Brent Climbs From $70-$75 Range

Brent crude crossed $100 per barrel on Wednesday, reaching its highest level in more than six weeks as tensions between the US and Iran intensified.

Before the conflict began at the end of February, Brent had been trading around $70-$75 per barrel.

Vasisht said the Indian crude basket was trading at approximately $109 per barrel after Brent crossed the $100 mark.

He added that crude prices could move higher if the geopolitical situation persists, particularly as countries such as China increase purchases while inventories decline.

West Asia Tensions Add To Supply Concerns

The rise in oil prices comes at a time when the conflict in West Asia is also creating uncertainty around energy supplies.

Indian refiners are consequently looking to diversify their sources of crude. Citing asenior refinery executive, the media organisation noted that refiners plan to increase their reliance on suppliers in Russia, Brazil and certain African countries to meet domestic energy demand.