High oil prices may hit India’s growth, but strong fundamentals offer a cushion: S&P

India’s strong domestic fundamentals, potential government support, and significantly improved corporate and banking health would soften the blow of rising crude oil prices caused by West Asian conflict, according to S&P Global Ratings. However, persistently high energy costs could still drag down overall economic growth, the rating agency noted.

In its scenario analysis on India, if oil prices average $130 a barrel in 2026, the country’s growth could slow by up to 80 basis points in FY27.