New Delhi/Srinagar: Global oil prices are expected to jump sharply when markets reopen on Monday, amid escalating tensions following the US-Israel confrontation with Iran and reports that Tehran has effectively closed the Strait of Hormuz — one of the world’s most critical oil transit chokepoints.
According to data from brokerage firm IG Group, US crude oil is on track to rise by nearly 9 percent when trading resumes in New York, potentially climbing from $67 a barrel on Friday to over $73 a barrel. If realised, this would mark the highest level since June 2025, when US strikes on Iran’s nuclear facilities triggered similar volatility in global energy markets.
Market analysts warn that any prolonged disruption in shipments through the Strait of Hormuz — through which roughly a fifth of global oil supply passes — could push prices significantly higher. Analysts at Barclays have indicated that crude could touch $80 per barrel in the event of a material supply disruption. Meanwhile, experts at Royal Bank of Canada cautioned that regional leaders had previously warned Washington about the “contagion risks” of another confrontation with Iran, flagging the possibility of oil prices exceeding $100 per barrel under extreme scenarios.
Implications for India
For India, which imports more than 85 percent of its crude oil requirements, the developments carry significant economic implications. A sustained rise in global crude prices could widen the country’s trade deficit, exert pressure on the rupee, and complicate inflation management.
Higher crude prices typically translate into increased retail fuel prices, unless offset by government tax adjustments. Rising fuel costs can also have a cascading effect on transportation, agriculture, and essential commodities, potentially pushing up overall inflation.
Energy analysts note that while India has diversified its crude sourcing in recent years and built strategic petroleum reserves, any disruption in Gulf supplies would still have a direct bearing on domestic fuel pricing and supply logistics.
Panic buying in Kashmir
The global uncertainty has already triggered anxiety in parts of Jammu & Kashmir. Long queues were reported at petrol pumps across Kashmir on Sunday as residents rushed to stock up on fuel amid fears of supply disruptions.
Fuel station operators said consumers were anticipating shortages if geopolitical tensions escalate further or if shipping through the Gulf is disrupted. While there has been no official announcement of supply cuts, the visible rush at pumps reflects heightened public concern.
Officials have not indicated any immediate disruption in fuel supply to the Union Territory, but experts caution that prolonged instability in West Asia could strain supply chains, particularly for landlocked regions like Kashmir that depend on road transport from refineries in northern India.
Market volatility ahead
Beyond oil, global equity markets are also expected to react negatively when trading resumes, as investors assess the risk of a broader regional conflict. Historically, geopolitical tensions in oil-producing regions have led to short-term spikes in crude prices and volatility in stock markets.
Much will depend on whether the situation stabilises diplomatically or escalates militarily in the coming days. For now, energy markets remain on edge — and countries like India, heavily reliant on imported oil, are bracing for potential economic aftershocks.
