Overview
- Finance Minister Nirmala Sitharaman told Parliament on March 9 that the recent jump in crude is not estimated to have a substantial impact on India’s inflation because headline price growth is near the lower bound.
- Following the late‑February escalation in the Middle East, the Indian basket rose from $69.01 a barrel at end‑February to $80.16 by March 2, while international benchmarks later approached $119–$120.
- Analysts at Crisil warned that prices near $120 a barrel could drive additional foreign currency outflows of roughly $7–8 billion per month, widening the current account deficit and lifting cost pressures.
- Axis Bank’s Neelkanth Mishra estimated that a sustained $50 per barrel increase would equate to about a $90 billion annual hit, more than 2% of GDP, though Oil Marketing Company buffers may delay retail fuel pass‑through for a few months.
- Global spillovers intensified as UK and eurozone government bond yields jumped and UK Chancellor Rachel Reeves said she supports a coordinated release of emergency oil reserves, with G7 and IEA officials discussing possible measures.