Brent crude prices surged by 8.2%, crossing the $100 per barrel mark, following an Iranian attack on two oil tankers in Iraqi waters. In response to the security threat, Iraq has suspended all operations at its oil terminals, causing significant disruption to global supply chains.

This escalation is a direct reaction to the International Energy Agency’s (IEA) decision to release 400 million barrels from emergency reserves to stabilize rising prices. Iran, seeking to maintain price pressure on the US and Europe, has warned that it will disrupt oil flow through the Strait of Hormuz if attempts to lower prices continue. They have further cautioned that prices could skyrocket to $200 per barrel.

The crisis poses a severe threat to India, which imports 80-85% of its oil from the Middle East, with Iraq accounting for 20% of its total supply. The sudden suspension of Iraqi oil exports has triggered a panic sell-off in the Indian stock market, with the Sensex plummeting over 900 points. As fuel prices look set to soar, experts warn of impending inflationary pressure on the Indian economy.