India’s reduced dependence on oil has strengthened macro stability, but crude remains the single biggest risk to market performance, Morgan Stanley said in its latest strategy note. The brokerage credited the decline in oil intensity measured by barrels imported per unit of GDP for supporting a market re-rating, while cautioning that a sharp rise in crude prices could reverse equity gains and strain external balances. Morgan Stanley on why falling oil intensity drives macro resilience Morgan Stanley said India’s structural shift away from oil dependence has been central to its improved economic fundamentals. The brokerage tracks oil intensity as barrels imported per unit of GDP rebased to 2007, and the data show a consistent decline since FY08. This trend, it said, means the economy’s sensitivity to global oil price swings has materially reduced over time.