S&P Global Ratings: $130 oil could cut India's FY27 growth
If oil prices average $130 a barrel in 2026, India's GDP growth could drop by 0.8% points in FY27, according to S&P Global Ratings.
The main reason? Ongoing conflicts in the Middle East are pushing up energy costs.
Still, S&P's base case expects India to grow at a solid 7.1% that year.
India's credit faces temporary strain
Rising oil prices would mean higher energy bills for everyone: households, businesses, and even banks could feel the pinch.
The government might face some tough choices on spending too.
But S&P thinks these bumps won't last long thanks to steps taken to cushion fuel costs and strong fundamentals in India's economy.
Corporate credit quality could recover sharply in FY28, while banks may see credit losses edge up over the next 12-24 months, with overall asset quality expected to remain healthy.