Indian Rupee falls to 95.84 against US dollar amid oil and geopolitical pressures

The Indian rupee has experienced significant depreciation, reaching 95.84 against the US dollar in recent trading. This decline follows a long-term trend where the currency has lost substantial value since India's independence, with the rate moving from approximately 3 rupees per dollar in 1947 to nearly 96 rupees in 2026.

Several structural and geopolitical factors are driving this volatility. A primary cause is India's heavy reliance on crude oil imports, which reached 88.4% between April and September 2025. As oil is traded in dollars, high demand for energy increases the need for US currency. Additionally, rising Brent crude prices, which touched USD 106 per barrel, have exacerbated concerns regarding India's external balance and inflation.

Geopolitical tensions, particularly in the Middle East and between the US and Iran, have increased safe-haven demand for the US dollar. Furthermore, high interest rates maintained by the US Federal Reserve have encouraged global capital to flow into dollar-denominated assets, further weakening emerging market currencies like the rupee.