Crude Oil Surges Amid US-Iran Conflict : What Experts Say About Future Impact and India's Energy Outlook
Current Market Position
As of June 9, 2026, crude oil markets remain volatile following tensions between the United States and Iran, though prices have moderated from earlier spikes. Brent crude recently settled around $111.45 per barrel (down over 2%), while U.S. West Texas Intermediate (WTI) futures dropped more than 3% to $102.65 per barrel after the U.S. confirmed the ceasefire with Iran remains intact.
However, the situation remains fragile. Oil prices had previously rose more than 4% on a single Monday when the ceasefire appeared close to unraveling, with Iran launching drones and escalating tensions. The market's sensitivity to geopolitical developments is evident—prices have already risen by approximately $10 per barrel (15%) since strikes began.
Expert Analysis on Future Impact
Price Projections by Institution
- J.P. Morgan : Expects Brent crude averaging around $60/bbl in 2026, maintaining a bearish forecast despite recent price spikes
- Goldman Sachs : Alarmed by the drawdown rate and uneven distribution, highlighting heightened risk of localized shortages
- Kpler Analysts : Prices could rise 9-15% if Iran's 3.3 million barrels per day production is disrupted, pushing benchmark prices from $70 to $76-81 per barrel
Key Expert Warnings
- Pan Mudiar, CEO of Enrich Money : "Oil prices have surged sharply with an approximate 7% spike amid intensifying fears of supply disruptions. Brent crude is now trading in the $95-98 per barrel range"
- Dr. Kaushik Deb, Executive Director, EPIC India : "Every time there is a crisis in the Middle East, India feels it in a very specific and material way. We import nearly 90 percent of the oil we consume, and now that we have dialled down crude imports from Russia, almost half of those imports pass through the **Strait of Hormuz** today"
- Sumit Ritolia, Lead Research Analyst at Kpler : "The waiver does not fundamentally change India's structural exposure to Middle Eastern supply flows"
Overall Impact on India
Critical Vulnerabilities
India faces severe exposure to this conflict due to several structural factors :
- Massive Import Dependency : India imports nearly 90% of its crude oil consumption
- Strait of Hormuz Risk: After reducing Russian oil purchases under U.S. pressure, India now relies heavily on Gulf suppliers, with almost half of imports passing through the Strait of Hormuz
- Inflation Impact : A 15% crude price increase (approximately $10/barrel) could push domestic inflation up by 0.5%
- Current Account Deficit : Rising oil prices could increase import costs for India, which imports over 80% of its crude needs, potentially widening the current account deficit
India's Strategic Response
Since March 2026, India has been redrawing its energy map :
- Russian crude imports surged to nearly 2 million barrels per day in March 2026—a 90% jump from February and a 9-month high
- Gulf supplies dropped from 2.6-2.7 mbpd to just 1.2-1.3 mbpd
- Total crude imports remain 800,000 barrels per day lower than pre-crisis levels
- LPG imports dropped 40% and LNG shipments declined significantly
Economic Consequences
The conflict creates multiple challenges for India :
- Inflation : Could rise by 0.5% from crude price increases
- Rupee : Lower oil prices could help strengthen the rupee
- Equities : Sustained stability may boost equities and push Nifty higher
- Import Costs : Over 80% crude import dependency widens fiscal pressure
- Supply Security : Total imports still 15% month-on-month lower than normal levels
Policy Recommendations for India
Experts recommend several measures to shield India's economy:
- Diversify supply sources beyond Middle Eastern suppliers to reduce Hormuz exposure
- Build strategic oil reserves to buffer against supply disruptions
- Accelerate renewable energy transition to reduce long-term import dependency
- Maintain diplomatic flexibility with Russia while managing U.S. relations
- Monitor secondary chokepoints like Bab el-Mandeb Strait, which remains volatile
Bottom Line
While the current ceasefire provides temporary relief, the US-Iran conflict has fundamentally altered India's energy security landscape. With nearly 90% import dependency and half of those imports now passing through the vulnerable Strait of Hormuz, India faces heightened exposure to Middle East instability. Experts warn that even limited disruption to Iran's 3.3 million barrels per day production could push prices 9-15% higher, directly impacting domestic inflation and the current account deficit.
The situation underscores India's urgent need to accelerate energy diversification and reduce reliance on Middle Eastern crude—a structural challenge that diplomatic waivers cannot fully resolve.
*This article analyzes current market conditions and expert projections as of June 9, 2026. Oil markets remain highly sensitive to geopolitical developments, and readers should monitor real-time updates for the latest price movements.