Crude oil prices may fall to $50/barrel by June 2026, says SBI report

Crude oil prices are expected to soften significantly in 2026, and they could touch $50/barrel by June 2026, a report said on Monday.

According to the SBI Research report, the deceleration of prices is likely to be faster, and this could average CPI inflation for FY27 decisively below 3.4 per cent.

Benign energy prices will impact the GDP outlook favourably, it said, adding that the expected impact on annual GDP growth is around 10-15 bps.

The medium-term trends since 2022 for Brent and Indian basket show that there has been a downward trend in crude prices, it added.

The latest event in Venezuela has not impacted the price significantly on the upside, the report pointed out.

 

Brent crude price has been hovering around $60 per barrel for the last one week.

Since oil prices constitute the largest component in the import basket and cannot be substituted with domestic production in the short term, contraction of the import bill on account of crude import prices will impact the rupee, it said.

Analysis, using recent history, suggests that assuming USD/INR base price of Rs 90.28, the 14 per cent expected correction may result in 3 per cent appreciation in the rupee, which is approximately Rs 87.5 per dollar, and a part of this could play out in Q4 FY26, it said.

The US Energy Information Administration estimates that the Brent crude oil price will fall to an average of $55 per barrel in the first quarter of 2026, largely driven by the buildup of inventory.