Top 5 Reasons Why Rupee Slips Below 95 Twice in 2026

Times are tough for the rupee as it again slipped to 95 against the USD towards the end of April 2026 after some gains due to the RBI-led interventions early this month. The depreciation is largely attributable to surging crude oil prices. The prices climbed to their 3-year high over the US-Iran conflict. On April 30, 2026, the rupee opened at 95.02 mark against the USD, sliding 0.2% from its previous days ending at 94.84 against the greenback. As the day progressed, it slipped further to a new record low of 95.32 against the USD, beating the earlier fall of 95.22 in March 2026.

Investors Fear Massive Crude Oil Price Spikes

The negative sentiment for the rupee gained prominence on April 30, 2026 as investors pondered over the economic risks threatening India in the face of likely crude oil price hikes of 2022, causing concerns for the net energy importer and wiping out capital flows.

Factors Contributing to a Slide in the Rupee‘s Value

Crude Soars Past $126/bbl, Rupee Slides Faster

The rupee is sliding mostly due to the surging crude oil prices, with Brent crude futures topping the $126/bbl mark, attaining their highest level in more than three years. At the same time, the US benchmark, West Texas Intermediate, is also trading high at approximately $110/bbl. Emerging market currencies such as the Indian rupee are deeply affected as oil trading is executed mostly in dollars. An increase in crude prices raises the demand for dollars, causing a fall in the rupee’s value. Other Asian currencies such as Thai Bhat, Philippine peso and Indonesian rupiah also lost more ground.

With shipments stalled through the Strait of Hormoz, the situation has become critical for India, which imports a massive proportion of its oil and energy requirements from the Middle East.

Import Bill Surges Due to Oil Pressure

The dual blockade of the Strait of Hormuz has made the markets feeling jittery about the smooth passage of the shipments. The situation is concerning as 20% of global energy supplies happen through this route.

According to a forex experts quote in a reputed Indian journal, oil itself has added $12-13 billion to the import bill every month for the last three months. The expert termed this as a pressure on trade deficit, inflation and eventually the rupee.

The Growing FPI Outflows

According to news reports, foreign investors have sold equities worth approximately $20 billion so far in 2026, beating the $18 billion outflow in 2025. This makes the rupee feel the pressure, allowing the dollar to become stronger. The NSE data estimated the net sale of domestic equities by FIIs at INR 2,185.95 crore as of April 29, 2026.

Dollar Index Rise

The US Dollar index gained strength following a hawkish stance adopted by the US Federal Reserve in its policy decision. A rise in the dollar index raises demand for the USD, making investors move away from riskier emerging market currencies such as the rupee to the dollar.

RBI Intervention May Not be Sufficient to Arrest the Rupee‘s Slide

Even though the RBI is intervening to help the rupee recover, the effort may not bear 100% results. According to experts, the strategy adopted by India’s central bank is of volatility management, not level defence. As long as Brent stays above $115 and FIIs continue to sell Indian equities, the rupees value against the USD will always be under pressure. The rupee might slip to 97 if Brent crude tops $125/bbl.

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