Rupee hits fresh record low as oil prices surge amid Iran ceasefire fears

The Indian rupee fell to a fresh record low against the US dollar on Tuesday morning as escalating concerns over the fragile Iran ceasefire and rising crude oil prices weighed heavily on market sentiment.

The domestic currency slipped 35 paise in early trade to touch an all-time low of 95.63 against the dollar at the interbank foreign exchange market. The rupee had opened at 95.57 before extending losses, following Monday’s sharp decline of 79 paise, when it closed at a record low of 95.28.

The latest weakness in the rupee came after US President Donald Trump suggested that the ceasefire with Iran was under severe strain, raising fears of prolonged instability in West Asia and tighter global oil supplies.

Speaking at the Oval Office on Monday, Trump described the ceasefire as being on “massive life support” after rejecting Tehran’s latest response to a US-backed peace proposal. He said hopes of a quick resolution to the conflict had faded and reiterated his administration’s hardline stance against Iran.

The comments triggered renewed anxiety in global energy markets, with investors concerned that the 10-week-old conflict could further disrupt oil supply chains.

Brent crude, the international oil benchmark, rose more than 0.8 per cent to trade above 105 dollars per barrel in futures trading, while oil prices remained elevated across Asian markets after gaining nearly 3 per cent in the previous session.

Currency market experts said the combination of rising oil prices and geopolitical uncertainty had increased pressure on emerging market currencies, including the rupee.

The dollar index, which measures the strength of the US currency against a basket of major global currencies, also edged higher during the session.

Indian equity markets mirrored the cautious sentiment, with benchmark indices opening sharply lower. The Sensex dropped more than 525 points in early trade, while the Nifty slipped over 160 points.

Investor sentiment was further dampened by continued foreign fund outflows. According to exchange data, Foreign Institutional Investors sold Indian equities worth more than Rs 8,400 crore on Monday.

With PTI inputs