Escalating US-Iran tensions are reigniting concerns about crude oil supply disruptions, with significant implications for India's economy.

Escalating US-Iran tensions are reigniting concerns about crude oil supply disruptions, with significant implications for India's economy. Nearly 20% of global petroleum and 30% of seaborne crude pass through the Strait of Hormuz daily, making any disruption a critical threat. Recent US warnings triggered a sharp 5% rally in WTI crude prices as markets priced in geopolitical risk. For India, a major crude importer dependent on Gulf supplies, even temporary supply interruptions could spike domestic fuel prices and accelerate inflation. While a complete strait shutdown remains unlikely due to US naval presence, heightened military activity, increased insurance premiums, and slower tanker movements could sustain elevated oil prices. The impact on India's economy hinges on the scale and duration of any meaningful disruption in this vital shipping corridor.