The Indian rupee has depreciated due to rising oil prices

NEW DELHI: The Indian rupee touched an all-time low of just $ 77 against the dollar in early trade on Monday, March 7, as oil prices soared, sparking an armed conflict between Ukraine and Russia. The rupee traded at 77.02 against the dollar this afternoon, higher than the previous low of 76.9 against the dollar in April 2021. Rohit explained that both the rise in Brent oil prices, which sold for $ 130.21 a barrel this Monday, and the outflow of foreign currency as a result of the Ukraine war were the main reasons for the depreciation. Azad, an economics professor at Jawaharlal Nehru University in New Delhi, said that given the uncertainty created by the conflict, foreign investors were withdrawing money from India, “taking it to safer markets, and oil prices are skyrocketing, so the bill for our imports is rising sharply” and the loss of currency. Causes, he noted. India, the world’s sixth-largest economy, is particularly dependent on oil, importing more than $ 15,000 million worth of crude oil in February, accounting for 27% of all its imports that month. Since the beginning of the conflict, on February 24, Brent has risen more than 34%, and today it peaked in 2008 due to fears of a supply shortfall. Faced with this trend, Azad did not expect the rupee to appreciate as the war continued, which would worsen the high inflation that has plagued Asian countries in recent years and further destabilize the lives of Indian society. The value of the rupee has already entered 2022, and after nearly four years of uninterrupted depreciation, many experts expect it to depreciate by the middle of this year. However, the armed conflict between Ukraine and Russia has advanced these predictions. The rupee did not stop depreciating by more than 17% against the dollar until it traded at 77.02 against the dollar this afternoon as it was equal to 63.85 against the dollar on January 1, 2018.