India Raises Brent Weight in Crude Basket to Fix 3-Year Distortion

India has altered the composition of its crude oil basket, raising the share of Brent-linked pricing above 50% for the first time, as per news reports.  

The Petroleum Planning & Analysis Cell (PPAC) revised the formula in March, assigning 61% weight to Dated Brent and 39% to Dubai and Oman benchmarks.  

The change departs from the earlier 79:21 split in favour of Dubai/Oman that remained in place until February 2026. 

Break From Usual Practice 

The revision was carried out during the financial year, which is uncommon. Typically, the weightage is reviewed once a year or over longer intervals.  

Officials indicated the change was treated as a special case, following sustained divergence between the official basket and actual import pricing over recent years. 

Three-Year Divergence Addressed 

Since 2022, India’s crude sourcing pattern has shifted. Supplies from Russia, along with cargoes from Africa and the Americas, have increased. A significant portion of these imports is priced against Brent.  

Russian oil alone accounted for about 35% of total imports during this period. Despite this, the basket continued to reflect a higher dependence on Dubai/Oman benchmarks. 

Disruptions in Supply Flows 

Recent geopolitical developments further altered sourcing. Imports from West Asia fell to around 910,000 barrels per day in March, compared with about 3 million bpd in February. Reduced movement through the Strait of Hormuz led refiners to secure cargoes from alternative regions, most of which are linked to Brent pricing. 

Physical crude markets tightened alongside these disruptions. Dated Brent rose above $140 per barrel before easing, while prompt cargoes traded at elevated premiums due to limited availability.  

Price Signal Correction 

Under the earlier formula, the Indian basket price rose to about $156 per barrel, a level that did not reflect actual procurement costs. The revised structure does not account for discounts or premiums but aligns more closely with the benchmarks used for imports. 

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Conclusion 

The updated formula brings the crude basket closer to prevailing sourcing and pricing patterns after a gap of several years. It provides a more consistent reference for tracking India’s crude import costs. 

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