India's current account deficit (CAD) will likely rise to 2.2 per cent of the gross domestic product (GDP) from 0.6 per cent in fiscal 2026 as Brent crude price will likely average $90-95 per barrel this fiscal, nearly 32 per cent higher than in fiscal 2026 higher oil prices, says Crisil. India's merchandise trade deficit increased to $28.2 billion in May 2026 from $22.6 billion a year ago, with the exports facing a "broad-based 18 per cent acceleration on-year to $45.2 billion in May, compared with 13.8 per cent to $43.6 billion in April."

Petroleum exports increased 54.9 per cent as against 34.6 per cent and core exports 12.3 per cent ($34.2 billion) as compared with 10.4 per cent ($31.6 billion). "The on-year jump in petroleum exports was due to a statistical low-base effect and reflected the 66.2 per cent on-year increase in Brent crude prices in May," Crisil noted. On a sequential basis, India's oil exports dropped to "$8.4 billion in May from $9.6 billion in April, led by lower crude oil prices on-month, after the extraordinary surge in the past two months on account of the conflict in West Asia," it said.

At the same time, Brent crude price averaged $107.1 per barrel in May, down 8.7 per cent vs April, noted Crisil. According to Crisil, higher oil prices will likely "exert greater pressure on the CAD.""Crisil Intelligence expects Brent crude price to average $90-95 per barrel this fiscal, ~32 per cent higher than in fiscal 2026. Oil remains the biggest source of the goods trade deficit (36 per cent in fiscal 2026)," the report said.

Despite the expected resolution of geopolitical uncertainties in West Asia "energy prices are expected to remain elevated on-year as it will take several months for supplies to normalise fully. Goods exports, too, will have to navigate lingering global trade disruptions," said Crisil. "For the current fiscal, we project the current account deficit (CAD) to rise to 2.2 per cent of the gross domestic product (GDP) from 0.6 per cent in fiscal 2026," said Crisil.

Published on June 18, 2026