US President Donald Trump stated that Iran is eager to make a deal and predicted a sharp decline in oil prices due to abundant supply, amidst a Senate resolution to limit his war powers in Iran.
Indian benchmark equity indices, the BSE Sensex and NSE Nifty, experienced a significant drop in early trade due to elevated oil prices, weak global market trends, and renewed fears of military operations in the Middle East following US President Donald Trump's statements regarding Iran. Track Sensex, Nifty on May 20.
The Indian government is set to accelerate reforms, including measures to enhance foreign direct investment, speed up divestment, and boost asset monetisation, to maintain economic growth despite rising fuel and fertiliser import costs driven by the West Asia crisis.
Bank of Baroda economists project India's GDP to grow 6.5-6.8 per cent in FY27 but warn that the fiscal deficit could overshoot the budgeted 4.3 per cent target, potentially reaching 4.7-4.8 per cent of GDP due to subsidy overruns, excise duty cuts, and oil marketing company losses.
India's state-run oil marketing companies (OMCs) are projected to incur under-recoveries of approximately Rs 80,000 crore on liquefied petroleum gas (LPG) sales in FY27 if current loss levels persist, according to rating agency Icra.
'Even last year, when India bought gold, the physical quantity was much less than the previous years.'
Hundreds of Indian seafarers are stranded on vessels carrying crude oil, LPG, and LNG in the Persian Gulf due to the ongoing conflict in the Middle East, causing disruptions to India's energy supplies.
The rupee weakened to a record low against the US dollar due to Gulf tensions, rising oil prices, and foreign capital outflows.
An oil tanker carrying Saudi crude safely reached Mumbai after crossing the war-hit Strait of Hormuz with its tracking system briefly switched off.
Indian oil marketing companies are incurring significant losses, selling petrol at a Rs 14 per litre loss and diesel at Rs 18 per litre, as elevated global crude oil prices, exacerbated by the West Asia crisis, outpace capped retail fuel rates, according to rating agency Icra.
The Quad grouping has expanded cooperation in critical minerals and energy, while unveiling new measures to boost maritime surveillance and port infrastructure across the Indo-Pacific. This move comes against the backdrop of China's growing military posturing in the region, with ministers reiterating strong opposition to destabilising actions and expressing serious concerns over militarisation of disputed features.
Maharashtra Chief Minister Devendra Fadnavis rode a motorcycle to work following Prime Minister Modi's appeal to cut down fuel consumption amid the ongoing conflict in West Asia.
Petrol and diesel prices in India have been increased for the second time in a week, following a long freeze on revisions. The increase comes as global crude prices surge and state-run oil firms look to recoup losses.
Trump further alleged that Iran was behind the attacks on three vessels carrying Indian seafarers near the Hormuz Strait, which resulted in the deaths of three, despite the US Central Command having confirmed that the strikes were carried out by American naval forces, calling the incident "totally unacceptable."
The rupee recovered to 95.18 against the US dollar after hitting an all-time intra-day low of 95.44. The recovery was supported by possible RBI intervention amid renewed Gulf tensions and rising crude oil prices.
The closure of the Strait of Hormuz has disrupted some 20 per cent of the global flows but even if it opens, damages to production facilities in the region will take time to repair, points out Sunita Narain.
Uncertainties stemming from the West Asia crisis and its potential impact on inflation and economic growth were key factors in the Reserve Bank of India's Monetary Policy Committee (MPC) decision to maintain the status quo on interest rates, according to the recently released MPC meeting minutes.
India will maintain multiple sources for crude oil purchases and diversify them to ensure stability in the supply chain with national interests remaining the "guiding factor" for the procurement, Foreign Secretary Vikram Misri said.
As tensions in the Middle East approach a critical juncture, reports have surfaced regarding a draft memorandum of understanding between the United States and Iran aimed at de-escalating the ongoing conflict, Iranian state media reported on Wednesday.
The Indian rupee is highly vulnerable among Asian currencies, with Barclays and MUFG warning of a potential depreciation towards 100/$ if the West Asia conflict persists, driven by widening current account deficits and elevated crude oil prices.
China has criticised the US blockade of the Strait of Hormuz, calling it a dangerous and irresponsible move, and urged Washington and Tehran to honour the ceasefire. Beijing also denied aiding Iran militarily and threatened countermeasures if the US imposes tariffs.
The Indian rupee gained 2 paise to settle at 93.33 against the US dollar, driven by positive sentiment in domestic equity markets and renewed hopes for US-Iran talks, despite rising WPI and CPI inflation.
Iran has reimposed restrictions on the Strait of Hormuz, with its forces opening fire on a passing tanker and forcing at least two Indian vessels to reverse course, escalating tensions in the region and raising concerns over energy supplies.
US President Donald Trump stated he would not set a deadline for ending the conflict with Iran, claiming Iran's military capabilities have been severely weakened. He also said he would not use nuclear weapons and maintained the US has complete control over blockade measures against Iran.
Rahul Gandhi accuses the government of compromising India's energy security by allowing the US to dictate oil supply relationships, raising concerns about the impact of global conflicts on India's energy access.
A senior government official says the idea is to facilitate mutually beneficial ways to keep the supply going.
Aviation fuel prices for domestic airlines remain unchanged, providing stability for local carriers, while commercial LPG and 5-kg cylinders see a significant rate hike due to rising international energy costs.
The Kremlin states it has not received confirmation from India regarding a halt to Russian oil purchases, following claims made by former US President Donald Trump. Russia affirms its commitment to strengthening relations with India.
Indian equity markets, including the Sensex and Nifty, experienced a significant downturn for the second consecutive day, driven by escalating geopolitical tensions in West Asia and persistent foreign fund outflows.
Foreign secretary Vikram Misri on Friday shared key details on agreements between India and the UAE, stating that the UAE will store up to 30 million barrels of crude oil in India's strategic petroleum reserve following Prime Minister Narendra Modi's visit.
A prolonged supply shock can transmit to lower incomes, and dampen confidence and sentiment, warns Aditi Nayar, chief economist, head-research and outreach, ICRA.
'If the war continue for a longer period of time, it is just a matter of time before the government will pass on some of the price increases.'
Iranian Foreign Minister Abbas Araghchi is in India for a BRICS foreign ministers' meeting, where discussions will focus on the escalating crisis in West Asia and its impact on global energy supply chains.
Private-sector oil refiner Reliance Industries Limited (RIL) last week received a general licence from the United States (US) government to buy Venezuelan oil, an industry executive said.
India's wholesale price inflation surged to 8.30 per cent in April, up from 3.88 per cent in March, primarily driven by a significant increase in the prices of fuel, power, and crude petroleum, according to data from the commerce and industry ministry.
The Reserve Bank of India's (RBI) cap on banks' forex positions provided only a temporary boost to the rupee, with the currency quickly reversing gains and breaching the 95-per-dollar mark due to persistent underlying pressures.
Analysts are revising down India Inc's financial year 2026-27 (FY27) earnings growth forecasts, citing persistently high crude oil prices above $100 a barrel due to the West Asia conflict, which is expected to dent corporate financial performance in the coming quarters.
Gold and silver prices experienced a significant drop in the national capital due to a global selloff driven by inflation concerns, central bank policies, and geopolitical tensions.
'In all these years of rupee depreciation, of rising oil prices, of inflation caused by import dependence, not one leader had the courage to look the people in the eye and say: Please do this for your country.'
According to the Pentagon, the vessels were targeted as part of efforts to prevent the deployment of naval mines in the strategically vital passage through which a significant portion of global crude oil shipments transits.
