US-Iran Escalation Pushes Global Oil Prices Higher
The recent escalation between the United States and Iran has significant implications for global oil prices and trade. The US military struck three Iranian oil tankers on September 5 after Iran fired ballistic missiles towards two American warships.
This latest round of retaliation highlights a worrying trend: every new round of escalation makes it more likely, while making a negotiated exit progressively harder.
India is particularly vulnerable to the Middle Eastern crisis. The country imports nearly 90% of its crude requirement, and Brent has crossed $95 a barrel amid the latest escalation.
A sustained increase in crude prices could add roughly ₹18,000 crore to India's annual oil import bill, widening the current-account deficit and feeding inflation.