What should be the NGINX settings for Drupal 7 website

Following NGINX server block can be used to run Drupal 7.

server {
        server_name YOURWEBSITENAME;
        root /var/www/html/drupal7;

        index index.php;

        location = /favicon.ico {
                log_not_found off;
                access_log off;
        }

        location = /robots.txt {
                allow all;
                log_not_found off;
                access_log off;
        }

        # Very rarely should these ever be accessed outside of your network
        location ~* \.(txt|log)$ {
                allow 127.0.0.1;
                deny all;
        }

        location ~ \..*/.*\.php$ {
                return 403;
        }

        location / {
                # This is cool because no php is touched for static content
                try_files $uri $uri/ @rewrite;
                expires max;
        }

        location @rewrite {
                # Some modules enforce no slash (/) at the end of the URL
                # Else this rewrite block wouldn't be needed (GlobalRedirect)
                rewrite ^/(.*)$ /index.php?q=$1;
        }

        location ~ \.php$ {
                include fastcgi_params;
                fastcgi_param SCRIPT_FILENAME $document_root$fastcgi_script_name;
                fastcgi_intercept_errors on;
                fastcgi_pass unix:/var/run/php-fpm.sock;
        }

}

Make sure you set correct value for "fastcgi_pass unix" as per PHP version installed in your system.