Crude oil prices are on the boil amid rising Iran Israel tensions. What does this mean for Indian markets? Which sectors could take a hit?
Brent crude oil prices surged by 13.17% in a single day on mounting geopolitical tensions, touching a high of $78.50 per barrel. At 2:10 PM IST, Brent was trading at $72.84 per barrel, still up 5.02% for the day. This marks Brent’s largest weekly gain since 2022, with prices having climbed nearly 28% since April 27, 2025.
The latest jump in oil prices followed Israeli airstrikes on targets in Iran, sparking fears of a broader conflict in a region that supplies around one-third of the world’s crude. Israel’s Defense Minister, Israel Katz, described the attack as a “preemptive strike” and announced a state of emergency, anticipating possible retaliation from Iran.
The recent geopolitical developments have added a significant risk premium to global crude prices. Brent crude, which had fallen to lows of around $58.20 per barrel in May, is now trading near $74. The market is increasingly factoring in the possibility of supply disruptions due to heightened uncertainty in the Middle East.
The strait is located between Oman and Iran, linking the Gulf to the north with the Gulf of Oman to the south and the Arabian Sea beyond.
The Strait of Hormuz has emerged as a key area of concern. Roughly one-fifth of the world’s total oil consumption passes through this narrow waterway, making it one of the most critical chokepoints for global energy supplies. Any disruption could severely impact oil movement from the Persian Gulf.
Military presence from the United States in the region has raised speculation about possible involvement. Any obstruction in the Strait could trigger another sharp spike in crude prices.
Back home, the Indian equity markets were under pressure, with the Nifty 50 index down by 0.83% at 24,681.2. A sharp rise in crude prices will have a direct impact on several sectors in India, especially oil marketing companies (OMCs), airlines, tyre manufacturers, and lubricant businesses. The Strait of Hormuz, a vital passage for India’s crude and LNG imports, remains a key area to watch.
From a macroeconomic perspective, the spike in oil prices could strain India’s current account deficit (CAD) and put pressure on inflation and the rupee.
The surge in oil prices also weighed on the Indian rupee, which briefly fell to 86.20 against the U.S. dollar.
Disclaimer: The article is for informational purposes only and not investment advice.
For android only