Oil above $100, global tensions rise: Sunil Subramaniam on what it means for Indian markets and investors

Fresh escalation in the Israel-Iran conflict has pushed crude oil prices back above the $100 per barrel mark, triggering fresh concerns for global markets, inflation, and especially oil-import dependent economies like India.

Market experts warn that the recent volatility is far from over, with geopolitical uncertainty continuing to drive sharp swings in commodities and equities.

Oil surge and global market jitters

After briefly cooling on hopes of a temporary truce, crude oil prices have rebounded sharply as hostilities resumed. The renewed strikes on energy infrastructure and rising tensions in the Gulf region have reignited fears of supply disruptions.


According to market expert Sunil Subramaniam, the earlier optimism around a short-term ceasefire was largely misplaced. The conflict, he says, shows no real signs of de-escalation, with both sides unwilling to step back.

This has kept oil prices elevated, with Brent crude hovering around $100–102 per barrel, a level that typically signals inflationary pressure across economies.

Why this matters for India

India imports nearly 85% of its crude oil requirements, making it highly vulnerable to global price spikes. Higher crude prices directly impact fuel costs, transportation, and eventually retail inflation.

Talking to ET Now, Subramaniam highlighted that rising oil prices are already pushing inflation higher globally, particularly in the US, where fuel costs are a politically sensitive issue.

For India, this could mean:

• Higher petrol and diesel prices
• Increased pressure on government finances (subsidies)
• Rising inflation and interest rate risks
• Weakening of the rupee
• Stock markets: Short-term bounce, long-term caution

Despite the negative global cues, Indian markets recently saw a temporary bounce. However, experts caution that this rally may not be sustainable.

The recent upmove was largely driven by short covering and retail participation rather than strong fundamentals. Foreign institutional investors (FIIs) continue to remain net sellers, indicating cautious sentiment.

“Today’s rally was not sustainable… markets are still in a risk-off mode,” Subramaniam noted, pointing to weak global cues like high oil prices, strong dollar, and elevated US interest rates.

Key indicators such as crude oil above $100, strong US dollar and high global interest rates suggest continued pressure on emerging markets, including India.

Geopolitics: India’s unique position

Amid rising tensions, India finds itself in a unique diplomatic position. It is one of the few countries maintaining communication with all key players involved.

Subramaniam pointed out that India has engaged with leaders across the spectrum, including the US, Israel, and Iran, making it a potentially important stakeholder in any future negotiations.

However, he believes India is unlikely to play an active intermediary role, and markets are not factoring in any immediate diplomatic breakthrough.

What should investors watch?

With uncertainty likely to persist, investors should keep a close eye on:

• Crude oil price trends
• US inflation and interest rate signals
• FII flows in Indian markets
• Rupee movement

A prolonged period of high oil prices could weigh on corporate earnings, especially in sectors like aviation, logistics, and manufacturing.

The bottom line

The current geopolitical tensions have once again highlighted how quickly global events can disrupt markets. While short-term rallies may occur, the broader outlook remains cautious.

For Indian investors, the key lies in staying disciplined, avoiding knee-jerk reactions, and focusing on long-term fundamentals amid global volatility.