Indian crude oil basket hits $115.98 a barrel: HSBC, Goldman Sachs raise Brent forecasts

Indian crude oil basket, a derived mix of sour grades (Oman and Dubai average) and sweet grade (Brent dated) processed in Indian refineries, climbed to $115.98 per barrel level on September 9, according to the latest data from the Petroleum Planning and Analysis Cell.

Indian crude oil basket averaged $104.09 a barrel in September so far, up 15.41 per cent from $90.19 in August, amid an escalation in the US-Iran war and shipping disruptions, intensifying concerns over inflation and global growth.

HSBC has raised its 2026 average Brent crude forecast to $90 a barrel from $80 a barrel as it cited threats to shipping through the Strait of Hormuz. Choice Institutional Equities, on the other hand, expects Brent to average at $84 per barrel for FY27 and $86 per barrel for the ongoing July-September quarter. Goldman Sachs had on September 8 upped upped Brent's forecast at $85 a barrel for December 2026 and $80 a barrel for 2027.  It suggested oil prices could rise to $120 a barrel if attacks on shipping increase.

"Renewed US-Iran escalation and continued disruption through the Strait of Hormuz should keep a geopolitical premium embedded in crude, with Brent likely to remain elevated unless there is a credible path towards de-escalation," Choice Institutional Equities said.

Brent crude futures for November delivery hit a high of $101.94 per barrel earlier today as the shipping choke points are threatening the global crude flows. It has reignited the physical damage to the gulf refining and production infrastructure, with geopolitical risk premium back into the market in the absence of any prospect of an immediate diplomatic resolution.

"Brent crude oil’s return of triple-digit price has triggered immediate warning signs across global financial systems. Vulnerable economies faces renewed threats of increasing import bills, widening current account deficit, currency stability and fiscal deficits with the global inflation raising worries on the global economic growth," said  N S Ramaswamy, Head of Commodity & CRM at Ventura.

Ramaswamy in a note said the development has complicated the job of central banks with respect to the interest rate outlook.