Brent Crude Surges to $126 Amid Fears of Iranian Conflict; Rupee Hits Record Low

Global Oil Prices Surge as Tensions Over Iran Escalate

Brent crude oil has reached a four-year high of around $126 per barrel, driven by reports that the US military may brief President Donald Trump on potential strike options against Iran as tensions over the Strait of Hormuz intensified.

According to Axios, citing unnamed sources, Trump is expected to be briefed by Admiral Brad Cooper, commander of US Central Command (CENTCOM), on possible military actions. CENTCOM has also prepared plans for a "short and powerful" wave of strikes targeting Iranian infrastructure, aimed at breaking the current diplomatic deadlock.

The news triggered a sharp spike in global oil prices, with Brent crude jumping as much as 7.1% to $126.41 in Asian trading, while West Texas Intermediate rose 3.4% to $110.31 before paring some gains.

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The sharp spike in global oil prices has triggered broader financial market stress, with the Indian rupee sliding to a record low of 95.3250 against the US dollar on Thursday. The currency weakened 0.5% on the day, breaching its previous all-time low of 95.21 hit earlier in March.

Oil-sensitive Asian currencies, including the Indonesian rupiah, Philippine peso, and Thai baht, have also come under pressure as energy markets reacted to rising geopolitical risks.

Analysts have said the rupee's decline has revived concerns over India's external sector vulnerabilities, particularly its dependence on imported crude oil. The rupee has now fallen nearly 6% in 2026, adding to losses from the previous year, amid persistent headwinds including global trade tensions, weak capital inflows, and renewed energy supply risks.

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According to HSBC estimates, India's GDP growth could slow to 6.3% if oil averages $80 per barrel, and drop to around 6% if prices stay near $100, highlighting the macroeconomic sensitivity to crude price shocks.

Market pressure has also intensified capital outflows, with foreign investors pulling out over $20 billion from Indian equities and bonds in March and April alone, nearly double the total outflows seen in all of 2025.

The rupee also faced additional strain after the US Federal Reserve signalled a hawkish policy stance, compounding the impact of the oil rally and escalating geopolitical uncertainty tied to the Iran situation, which has raised fears of broader supply disruptions and global stagflation risks.