The Indian rupee opened at a lifetime low of ₹92.20 against the US dollar, pressured by surging crude oil prices and risk-off sentiment.
The Reserve Bank of India reportedly intervened in the spot and non-deliverable forwards market to stabilise the currency.
Crude prices surged above $120 per barrel, raising concerns over India’s import bill as the country relies on imports for nearly 90% of its energy needs.
The rupee opened at a lifetime low of ₹92.20 against the greenback, a 0.5% fall from its previous close, owing to the spike in crude oil prices. According to market reports, the Reserve Bank of India intervened in the non-deliverable forwards market and in the spot market in early trade.
The rupee was heavily weighed down by the sudden rise in crude oil, which rose over 30%, hitting a multi-year high of $120 per barrel on Monday amid rising geopolitical tensions in West Asia.
2 March 2026
Get the latest issue of Outlook Business
The rupee also came under pressure as foreign investors purchased dollars, as fears of prolonged and elevated geopolitical concerns in West Asia triggered risk-averse sentiment among them.
In early trade, the benchmark indices, the Nifty 50 and Sensex, crashed by 700 and over 2,000 points, respectively. The dollar index, which measures the strength of the greenback against a basket of six major currencies, also strengthened owing to safe-haven demand.
“Geopolitical tensions persist with no clear signs of resolution. Safe-haven demand for the US dollar has also strengthened amid rising tensions,” Ritesh Bhansali, deputy chief executive officer at Mecklai Financial Services Private Ltd, said in a note.
Crude oil prices are now up over 50% since the war between Iran, Israel and the US erupted. India imports nearly 90% of its energy requirements, making the country critically vulnerable to global crude and energy prices.
A rise in crude oil will heavily weigh on India’s import bill. Moreover, supply chain concerns amid reduced output by oil-producing countries including Iran, Iraq and Kuwait have also raised questions about India’s reserves. India has crude stockpiles to manage for 60 days; however, liquefied petroleum gas (LPG) and liquefied natural gas (LNG) do not have any reserves, making the country extremely vulnerable and exposed to global uncertainty.
Analysts estimate that oil prices are expected to remain higher even if a resolution is reached soon. Damaged infrastructure, risks to shipping and disrupted supply chains have left traders to bear the brunt of the war.
