Despite healthy marketing margins for petrol (MS) and diesel (HSD) through most of FY2026, the West Asia conflict led to a sharp deterioration, turning the segment loss-making during March-May 2026. However, margins have since recovered due to retail fuel price hikes and excise duty cuts, with petrol margins turning positive at Rs. 5/litre, while diesel losses have narrowed significantly from March 2026 but remained negative at Rs. 15/litre in August 2026.

• Singapore GRMs rose by almost 3.8x from nearly $6.5/bbl in FY2026 to around $25/bbl in YTD FY2027, driven by disruption-led supply tightness and strong distillate cracks.
  
• Brent rose sharply from $70/bbl in late-February 2026 to nearly $138/bbl in early-April 2026 amid the West Asia conflict and Strait of Hormuz risks, before correcting to ~$70/bbl by end-June 2026 following the peace deal. Prices later rebounded to ~$95/bbl by mid-August 2026 on renewed supply concerns and tighter market fundamentals.
  

Source: IMF Portwatch, ICRA Research