Rupee Falls to Record Low of 95.33 Amid Oil Surge and FII Outflows

Mumbai | 30 April 2026 

The rupee touched 95.33 per dollar during Thursday’s session, a fall of 0.5% intraday, breaching its previous record low of 95.21 set in late March. The currency recovered partially to close at 94.91, but gains built after the RBI introduced rare currency-supportive regulatory measures last month have been fully erased. The rupee had rallied to 92.40 earlier in April before the reversal took hold. 

What Pushed the Rupee to a Record Low? 

Brent crude futures climbed to $126.4 per barrel on Thursday, the highest level in four years, before pulling back in a volatile session. For India, which depends heavily on energy imports, an oil surge of this scale creates pressure on multiple fronts. It widens the trade deficit, lifts import prices, and raises concerns over the country’s inflation-growth balance. 

Foreign investor outflows compounded the pressure. Foreign investors sold over $20 billion of Indian stocks and bonds across March and April combined, nearly double the $11.8 billion in outflows recorded across all of 2025. The scale of selling has driven sustained dollar demand, adding to the rupee’s weakness. 

The rupee has now fallen over 5% in 2026, extending a similar-sized decline from the previous year. India’s external sector has faced persistent pressure from US trade frictions, weakening capital inflows, and the most severe energy supply disruption in history. 

How Does the Oil Surge Feed Currency Weakness? 

Rising oil prices hit the rupee through two channels simultaneously. Indian importers, particularly state-run oil companies, need to buy dollars to pay for crude, lifting dollar demand in the spot market. Higher oil prices also erode returns for foreign investors holding Indian assets, accelerating outflows and reducing the supply of dollars entering the country. The two forces reinforce each other, making it harder for the RBI to stabilise the currency. 

Other oil-sensitive Asian currencies faced similar pressure on Thursday. The Indonesian rupiah also weakened, reflecting the broad regional impact of the crude price surge. 

What is Happening at the Strait of Hormuz? 

A significant portion of global oil supply transits the Strait of Hormuz. The United States is currently pushing other countries to form a coalition to restore freedom of navigation in the strait. Disruption to this route has contributed to the surge in crude prices and the broader energy supply shock weighing on emerging markets, including India. 

What has the RBI Done so Far? 

The RBI deployed rare currency-supportive regulatory measures late last month, which briefly pushed the rupee to 92.40. Those gains have since been fully reversed. The reversal has renewed market attention on whether additional regulatory steps may follow. 

Outlook 

The rupee closed Thursday at 94.91, paring intraday losses but remaining under pressure. With Brent crude near four-year highs and foreign investor outflows continuing at an accelerated pace, the external conditions driving the rupee’s decline remain in place. 

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