Rising crude prices and US-Iran tensions drive the USD/INR pair higher, weakening the INR amid India’s heavy oil import dependence.
The Indian Rupee (INR) fell against the US Dollar (USD) at Thursday’s open, with the USD/INR pair climbing to near 95.65. The decline follows a sharp rebound in oil prices, fueled by escalating US-Iran tensions and fears of a ceasefire collapse.
India’s MCX Crude Oil contract for June 18 delivery rose 0.7% to 8,787, extending Wednesday’s 3.6% surge. The country’s reliance on oil imports makes the INR particularly vulnerable to crude price spikes.
US military strikes against Iran late Wednesday, described as retaliation for Tehran’s aggression, further heightened geopolitical risks. President Trump signaled potential additional strikes, adding to market uncertainty.