Indian Shares Set To Tumble As Oil Prices Spike Amid West Asia Tensions

(RTTNews) - Indian shares are seen opening on a sluggish note Monday as increased geopolitical risks added a new layer of uncertainty for global markets. That said, shares of upstream oil companies and defense stocks are expected to perform well.

Inflation worries returned to the fore as oil prices surged by the most in four years on worries that the U.S. and Israel's attack on Iran could escalate across the region and hit oil supply.

With the Strait of Hormuz, a critical oil chokepoint, facing potential disruptions, eight OPEC+ nations have announced that they will increase crude oil output by 206,000 barrels daily in April.

In an interview with the New York Times, U.S. President Donald Trump has outlined three conflicting scenarios for how Iran's regime might reorganize after the death of Supreme Leader Ayatollah Ali Khamenei.

Asian markets fell alongside U.S. equity futures as escalating tensions in West Asia fueled risk aversion.

The dollar index rose and U.S. Treasury yields inched higher while benchmark oil prices were up 4-5 percent. Brent crude prices jumped almost 13 percent earlier before paring gain. Gold prices were up nearly 1 percent above $5,300 an ounce.

U.S. stocks fell notably on Friday and notched their largest monthly percentage declines in a year on the back of escalating U.S.-Iran tensions, revived tariff uncertainties and renewed concerns over costs, disruption and layoffs related to artificial intelligence.

Prices paid to U.S. producers rose in January by more than forecast, pointing to lingering inflationary pressures and denting hopes for Federal Reserve rate cuts in the near term.

There were also concerns about possible losses from the collapse of U.K. residential mortgage bridging lender Market Financial Solutions.

The Dow lost 1.1 percent, the tech-heavy Nasdaq Composite shed 0.9 percent and the S&P 500 slid 0.4 percent.

European stocks ended mixed for a second straight session on Friday, with AI-related and geopolitical news in focus.

The pan European Stoxx 600 edged up by 0.1 percent. The German DAX finished marginally lower and France's CAC 40 dropped half a percent while the U.K.'s FTSE 100 added 0.6 percent.