Kitchen Budget Alert: Why Middle East crisis is quietly pushing edible oil prices to Rs 182

An average Indian consumer uses up to 12 kg of edible oil in a year, as per data from Niti Aayog. With a country that flaunts the world’s largest population, the country also depends on imports for 56% of its edible oil demand (Niti Aayog data of 2022-23). This makes it clear that the West Asia conflict has started hitting an average kitchen in more ways than just the LPG crisis; it is also proving to be a direct threat to your monthly budgets.

A recent note by Crisil Ratings estimated that refined sunflower oil volume could fall by 10% in the current fiscal year, because of supply disruptions and rising prices that are pushing consumers to look for cheaper alternatives. 

The pressure is coming from two sides. On the supply front, shipping routes have been disrupted, with vessels avoiding conflict zones and taking longer routes such as around the Cape of Good Hope. On the demand side, higher retail prices are nudging consumers to switch oils. Crisil noted that sunflower oil retail prices have already risen to Rs 170–175 per litre from around Rs 150 in January 2026. 

Prices on the ground: what the latest data shows

As per data from the Department of Consumer Affairs’ price monitoring division, packed Sunflower oil was being sold at an average retail price of Rs 182.36 per kg as of April 2, 2026. On March 2, 2026, the same oil was being sold for Rs 175.39, and to give a greater context, on April 2, 2025, Sunflower oil was being sold at an average retail price of Rs 158.61, which is a 13% difference in a year. Crisil said import prices of crude sunflower oil have risen to $1,420–1,440 per tonne from $1,275 over the past year because of freight costs and currency weakness.

Similarly, Groundnut oil’s average retail price as of April 2, 2026, is Rs 198.05 per kg, as compared to Rs 193.69 on March 2, 2026 and Rs 191.38 as of April 2, 2025. 

Mustard oil was being sold at Rs 188.07 per kg on April 2, 2026, Rs 186.8 per kg on March 2, 2026 and Rs 169.47 per kg on April 2, 2025.

Vanaspati oil was being sold at an average retail price of Rs 157.48 per kg on April 2, 2026, Rs 156.49 per kg on March 2, 2026 and Rs 152.78 per kg on April 2, 2025.

Soya oil was being sold at an average retail price of Rs 155.7 per kg on April 2, 2026, Rs 150.61 per kg on March 2, 2026 and Rs 146.28 per kg on April 2, 2025.

Palm oil was being sold for Rs 140.93 per kg on April 2, 2026, Rs 136.01 per kg on March 2, 2026 and Rs 138.67 per kg on April 2, 2025. 

A heavily import-dependent market

Why exactly should India be worried? The country’s vulnerability to global shocks stems from its over-reliance on imports. According to Niti Aayog’s data, India only meets 44% of its edible oil demand domestically as of 2023-24. The rest comes from imports. 

In 2023-24 alone, 15.66 million tonnes of edible oil were imported, accounting for roughly 56% of total demand.

How much oil Indians consume

This is the most interesting part of the story. According to government data, an average person in the urban part of the country consumes 11.78 kg of oil per year as of 2022-23. In rural areas, the consumption is 10.58 kg per year. 

According to Bloomberg, the conflict has triggered a broader energy shock, including LPG shortages in parts of India. This is now feeding into consumption patterns. With about 40% of vegetable oil demand coming from hotels, restaurants and caterers, a slowdown in food services is dragging overall demand. Eateries across cities have cut back operations or shifted to alternative fuels, reducing oil consumption, the Bloomberg report noted. 

Furthermore, the Bloomberg report also mentions that India’s vegetable oil demand could fall by 250,000–300,000 tonnes per month and that import costs have surged by around 25%.

At the same time, consumers are buying cautiously. “Demand has gone hand-to-mouth,” as one industry executive told Bloomberg, with households avoiding stocking up at high prices.

Substitution and shifting consumption

The price gap between oils is now shaping consumption choices. With sunflower oil trading at a premium of Rs 10–20 per litre over soybean and rice bran oils, a gradual substitution is underway, according to Crisil.

Despite the demand slowdown, refiners are relatively insulated for now. According to Crisil Ratings, Operating margins are expected to remain stable at ~4.8–5%, and lower inventory levels (down to 20–30 days from 30–45 days) are aiding short-term liquidity

Although things may not seem very far-fetched right now, this makes it clear that even a distant conflict can alter what and how much ends up on an Indian plate of food.