India trade deficit in June 2026 rises as oil prices and Strait of Hormuz risks bite

India’s trade deficit widened to $30.43 billion in June from $28.21 billion in May. The gap grew as exports fell faster, while imports stayed far higher. The move came as crude oil risks increased worldwide. Finance readers tracked the deficit because it can influence the rupee, inflation, and market sentiment.

A trade balance is the difference between goods exports and goods imports. The simple method is exports minus imports. A positive value means a surplus. A negative value means a deficit. In June, exports were $40.41 billion and imports were $70.84 billion. That arithmetic left a wider shortfall.

Both trade lines declined month-on-month, but the import bill remained much larger. Exports slipped from $45.20 billion in May to $40.41 billion in June. Imports eased from $73.41 billion to $70.84 billion. The table lists the two months and the deficit figure mentioned for each month.

Month	Goods exports ($ billion)	Goods imports ($ billion)	Trade deficit ($ billion)
May	45.20	73.41	28.21
June	40.41	70.84	30.43

The deficit had been widening since November 2025. It narrowed sharply to $20.67 billion in March 2026. It then rose to $28.38 billion in April. On trade policy, Rahul Bajoria said, "The India-UK Comprehensive Economic and Trade Agreement (CETA) will come into force on July 15, 2026, marking one of India's biggest bilateral trade deals in recent years,"

"The Double Contribution Convention (DCC), also known as the social security agreement, will also take effect on the same day. It will allow many Indian professionals working temporarily in the UK to avoid paying social security contributions in both countries. According to media articles, the agreement is expected to reduce or remove tariffs on a wide range of Indian exports, improve access for Indian services companies, and make it easier for professionals to work in the UK."

India trade deficit: Brent crude and the Strait of Hormuz risk

India is the world’s third-largest oil importer, so crude moves matter for trade. Brent crude, a key global benchmark, was described as rising to $120/barrel. Oil prices were also up nearly 10% on Monday and touched $85/barrel. Tensions in the Strait of Hormuz added uncertainty for energy supply routes.

The United States launched missiles at Iran, followed by retaliation in the region. Iranian forces struck the United Arab Emirates, Qatar, Kuwait, Oman, and Bahrain. The International Energy Agency stated, "While the global oil market balance looks set to swing back to surplus towards the end of the year, the forecast hinges on the assumption that tanker flows through the Strait will gradually recover, allowing producers to restart fields and refiners in the Middle East and elsewhere to resume product shipments," according to the International Energy Agency's report, which was published on ."

The IEA added, "Renewed exchanges of fire in the Gulf this week highlight the risks of not reaching a lasting peace agreement, which is a must for the normalisation in oil markets." Currency and equities also reflected these pressures. The rupee had depreciated about 11-12 percent since early 2025. Strategists warned oil could push it to 100 per US dollar.

Anil Kumar Bhansali said, "Oil prices climbed after renewed geopolitical tensions in the Middle East and concerns over disruptions to supplies through the Strait of Hormuz. India being a major oil importer, higher crude prices remain negative for the rupee," Bhansali also said, "Demand for the US dollar increased as investors moved toward safe-haven assets amid heightened geopolitical uncertainty putting pressure on most Asian currencies, including the rupee."

Equity benchmarks also stayed weak amid the same uncertainty. Nifty 50 and Sensex had both dropped more than 7% so far this year. The note also flagged higher chances of FII outflows if risks persisted. The Strait of Hormuz is about 20 miles wide at its narrowest, yet its impact can extend across India’s trade, prices, currency, and markets.