The Indian rupee plunged to an unprecedented low against the US dollar on Friday, breaking past its previous record as global oil prices spiked and foreign investors continued their exodus from Indian markets.
Indian Rupee falls to all-time low as Oil Prices surge
The currency weakened to 83.99 per dollar, surpassing its previous record low of 83.9850 set on September 12, and falling from Thursday’s close of 83.9675. This decline marks a significant reversal from the rupee’s recent recovery to 83.50 just two weeks ago.
Angel One analyst Saish Sandeep Sawant Dessai attributes the decline to mounting concerns in global oil markets: “Yesterday, crude prices traded higher by more than 3 per cent on concerns about potential supply disruptions in the Middle East, with Israel planning to strike oil-producer Iran, and on spikes in fuel demand as a major storm barrelled into Florida.”
Foreign investors worry may exit
The situation is further complicated by Hurricane Milton’s impact on America’s fuel supply chain. “The world’s largest oil producer and consumer has been hit by a second major storm… which made landfall on Florida’s west coast, spawning tornadoes and threatening surges of seawater,” Dessai explained.
The confluence of Middle East tensions and natural disasters has created a perfect storm for oil prices, with approximately 25% of Florida’s fuel stations already reporting supply shortages, putting additional pressure on the rupee.
