India’s financial markets came under pressure on Thursday as a sharp rise in global oil prices pushed the Indian Rupee to a record low and dragged down stocks and bonds.
The rupee weakened by about 0.3 percent to 92.3575 against the U.S. dollar, surpassing its previous lifetime low of 92.3475 recorded earlier this week. Traders said intervention by the Reserve Bank of India helped limit the currency’s losses.
Global oil prices jumped as Iran intensified attacks on oil and transport infrastructure across the Middle East. The benchmark Brent Crude Oil climbed to around 100 dollars per barrel, with warnings that prices could rise as high as 200 dollars if supply disruptions worsen.
The surge in oil prices raised concerns about higher inflation and slower economic growth in India, one of the world’s largest energy importers.
India’s benchmark stock index, the Nifty 50, fell around 1 percent, while yields on the country’s 10-year government bond rose about four basis points as investors reacted to the economic uncertainty.
Currency traders said the central bank is likely to intervene if the rupee moves beyond the 92.30–92.35 range. However, analysts warned that if oil prices remain elevated for several sessions, authorities may have limited ability to support the currency.
Pressure on the rupee was also visible in hedging markets. The one-year implied hedging cost rose above 3 percent for the first time since December 2025, while short-term volatility measures climbed to near their highest levels since May last year.
The impact of rising energy prices was felt across Asia, with regional currencies weakening between 0.1 percent and 0.7 percent and Asian stock markets falling more than 1.5 percent.
Analysts say Asian economies that rely heavily on imported energy, particularly those dependent on oil shipments through the Strait of Hormuz, could face significant economic pressure if the oil shock continues.
Investment banks including Goldman Sachs and Morgan Stanley warned that India could face growing risks to economic growth, as higher energy costs increase inflation while also affecting demand for exports.