High oil prices erode the resilience of foreign exchange reserves, and Indian assets are under pressure amid global safe-haven trends.

Due to the reopening of trading in the Indian market after the holiday on Tuesday, the high oil prices continue to put pressure on the rupee. Analysts at Maybank stated that considering India's status as an oil importing country and its geopolitical proximity to Iran, India and the rupee may be one of the assets most affected by the Middle East conflict. Huabon Securities pointed out that the rupee experienced a sharp decline after the outbreak of the Iran crisis led to a surge in oil prices; with investors turning to safe-haven assets, foreign capital outflow from the stock market, and concerns that high import costs will damage India's trade balance intensifying, the rupee is still under pressure. Currently, the rupee is trading near historic lows against the US dollar, having softened to around 92. This will lead to speculation in the market about intervention by the Reserve Bank of India, but Maybank pointed out that since the central bank has not vigorously defended the levels of 89, 90, or 91, it appears to have withdrawn from intervention.