The domestic currency opened at 96.49 per US dollar, compared with Wednesday’s (July 22’s) closing level of 96.57, recovering 8 paise in early trade after ending the previous session near its weakest level in more than two months.
The rupee has remained under pressure in recent sessions as renewed tensions between the United States and Iran triggered a sharp rally in global crude oil prices. The conflict has raised concerns over potential disruptions to oil supplies from the West Asia, a key source of India’s crude imports.
Brent crude climbed above $96 a barrel, its highest level in about six weeks, after the US launched fresh strikes on Iran-linked targets and Yemen’s Houthis. The Houthis have threatened to target vessels carrying Saudi crude through the Red Sea, increasing fears of supply disruptions.
For India, which imports more than 80% of its crude oil requirement, higher oil prices typically increase the country’s import bill, widen the current account deficit, and raise demand for US dollars from oil marketing companies. This often puts downward pressure on the rupee.
Despite these headwinds, traders said intervention and liquidity measures by the Reserve Bank of India (RBI) have helped prevent sharper losses in the domestic currency.
According to a currency trader at a private sector bank, downside risks for the rupee remain elevated, although RBI support is expected to limit excessive depreciation.
The rupee had found some relief in recent sessions due to robust foreign inflows linked to the RBI’s policy measures. However, market participants believe sustained gains may remain difficult if crude oil prices continue to rise.
Analysts say the trajectory of crude oil prices and further developments in the US-Iran conflict will remain key factors influencing the rupee in the near term. If geopolitical tensions intensify and Brent crude moves closer to the $100-per-barrel mark, pressure on the Indian currency could increase further.
-With Reuters inputs
First Published: Jul 23, 2026 9:27 AM IST
