India's Crude Import Bill Stays Above $100 Even as Brent Slides Below It
Freight and war-risk insurance charges have driven India's landed crude cost past $100 per barrel, a gap that futures markets are not pricing.
India's average crude import price crossed $100 per barrel in the final week of August (week of 2026-08-31), oilprice.com reported on Monday (2026-09-07), with further increases expected during the week of 2026-09-07 as hostilities in the Middle East intensify. ICE Brent crude front-month was trading at $96.28 per barrel on Monday (2026-09-07), yet India's actual landed cost has run consistently above that level since the war began on February 28.7
The gap between the futures price and the import bill traces directly to freight and insurance. When Hormuz vessel traffic rebounded in late June (2026-06-26), ICE Brent crude front-month fell roughly 20% to around $72 per barrel over a single month, Livemint reported, and US crude erased nearly all its war-era gains. Futures markets treated the partial reopening as evidence the supply shock was largely resolved.3,4
Freight rates did not follow. The rate for a very large crude carrier from Saudi Arabia's Ras Tanura terminal to India hit $4.34 per barrel in August, a 411% rise from $0.85 per barrel before the war, according to Financial Express data reported by oilprice.com. War-risk insurance on a single Hormuz passage has risen from roughly $250,000 before February 28 to as much as $10 million per voyage.6
Those charges show up in the trade data. India paid 60% more for crude imports in the April-June quarter year on year. July's import bill ran 41% above the year-earlier figure on slightly lower volumes, oilprice.com reported. The surcharge persists as long as underwriters and tanker operators price Hormuz voyages as high-risk passages, regardless of where Brent settles on any given day.7
Rerouting offers limited relief. Freight from the US Gulf port of Corpus Christi to India now costs $15.86 per barrel, up 150% from $6.35 per barrel before the war. Suezmax tankers from Russia's Ust-Luga on the Baltic Sea have more than doubled to $19.90 per barrel, according to Financial Express data reported by oilprice.com. Urals spot crude stood at $86.70 per barrel on Monday (2026-09-07). Once that freight rate is applied, the Russian discount narrows sharply, leaving Gulf crude, despite its elevated surcharges, still the most economical delivered option for most Indian refiners.6
Vessel transit data add a second dimension to the physical recovery picture. S&P Global Commodities at Sea recorded 73 crossings over several days around July 12 (2026-07-12), averaging fewer than 25 per day, Livemint reported. Before the war, the strait handled roughly 20% of global oil supply and about 18.2 million barrels per day of crude and products in 2025, according to OGJ data.5,1
Saudi Arabia had resumed tanker loadings at Ras Tanura by late June (2026-06-26), but Gulf exports stood at roughly 75% of prewar levels at that point, Bloomberg reported. The EIA estimated Middle East crude production shut-ins averaged roughly 10.5 million barrels per day in April, with a peak projected above that level, according to OGJ. Asian economies absorbed the bulk of the exposure, accounting for nearly 80% of Hormuz oil flows. China imported close to 5 million barrels per day through the strait, and India, Japan, and South Korea each took around 2 million barrels per day, according to OGJ.4,1
The futures market's June correction assumed that resumed loadings and rising transit counts were sufficient to normalise physical supply costs. They were not. Insurance underwriters and tanker operators reprice risk on the basis of actual incident history, not diplomatic signals, and a vessel struck off the Omani coast in late June (2026-06-25) underscored that Hormuz passages remain contested, Rigzone reported.2
Monthly Indian crude import data for August, the first full month with ICE Brent front-month back above $90, will be the clearest read on whether the import bill is stabilising. Daily transit counts from S&P Global Commodities at Sea are the second metric: a sustained return toward prewar volumes would support the June correction in crude futures; counts stuck near 25 per day would suggest the physical premium has further to run.5,7