Rupee Under Pressure: Hits All-Time Low of 93.24 as Brent Crude Holds Above $115

The Indian rupee plunged to a fresh record low on Friday morning, breaching the psychologically significant 93-level for the first time as escalating hostilities in West Asia sent global oil prices surging.

The rupee was trading at 93.24 against the US dollar at 10:33 am IST, down nearly 0.4% from its previous close. This marked the steepest intraday slide in three weeks, driven by aggressive dollar demand from oil importers and a sharp sell-off in domestic equities.

Oil and Geopolitical Headwinds

The primary catalyst for the rupee’s decline is the sustained spike in benchmark Brent crude, which hovered above $115 a barrel on Friday. India, the world’s third-largest oil consumer, is highly vulnerable to energy price shocks, which widen the country’s current account deficit and increase the demand for dollars. Karan Rijhsinghani, Director & Head, Product & Advisory, Atom Privé Financial Services, noted, “The recent depreciation in the Indian rupee is largely being driven by a combination of global macro pressures rather than domestic weakness. The most immediate trigger has been the sharp rise in crude oil prices amid escalating geopolitical tensions in the Middle East. With India importing over 80% of its crude requirements, any sustained increase in oil prices directly widens the trade deficit and increases demand for dollars, putting pressure on the rupee.” He further added, "At the same time, we are seeing a shift in global capital flows. Higher US bond yields and a stronger dollar have made developed market assets more attractive, leading to foreign portfolio outflows from emerging markets, including India. This has added to currency pressure, especially in the near term.
It’s important to note that structurally, India runs a current account deficit, which means the rupee is naturally sensitive to external shocks like oil and capital flows. However, the situation is not without buffers. India’s forex reserves remain above $600 billion, and the RBI has historically intervened to prevent excessive volatility rather than defend any specific level."

Prof Jaydeep Mukherjee, Prof in Economics, Great Lakes Institute of Management, Chennai, added, “Geopolitical uncertainties due to ongoing conflict in the Middle East have made foreign investors shift to safe haven assets like gold and sovereign bonds. Foreign investors have pulled out nearly $5 billion from Indian equities in March 2026 alone. Higher US bond yields driven by the anticipation of future Federal Reserve tightening to control inflation have made the US dollar relatively more attractive in recent periods.”

RBI Intervention 

Reserve Bank of India (RBI) likely intervened via state-run banks to provide some dollar liquidity and prevent a "runaway depreciation." Despite these efforts, the rupee remains one of the worst-performing emerging market currencies this week.

If Brent crude touches the $120 mark, the rupee could quickly test the 94.00 level. 
“In terms of recovery, the outlook depends largely on external variables. If crude oil prices stabilise below the $90–95 range and geopolitical tensions ease, the rupee could see near-term stabilisation. However, if oil remains elevated and global rates stay higher for longer, the rupee may continue to trade under pressure," said Rijhsinghani, adding that, “Overall, this phase should be seen as cyclical rather than structural, with stability likely returning as global conditions normalise.”

“In the short run, the rupee is expected to remain volatile. As global oil prices continue to hover above $100, the currency is likely to fluctuate within the 92.50 - 94.50 range,” said Mukherjee. 

Snehith Reddy Meda, Partner, E-Infra noted that recovery of the rupee depends on global conditions, “If oil prices stabilise and geopolitical tensions remain contained, we could see some near-term consolidation. The Reserve Bank of India has also been actively intervening to manage volatility, which should prevent disorderly depreciation.” He added, “However, a sharp recovery in the rupee is unlikely in the immediate term. Currency movements today are increasingly driven by global liquidity cycles and capital flows. The more realistic expectation is a period of stability rather than a rapid reversal, with gradual recovery linked to easing global conditions and sustained domestic growth fundamentals.”

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