Brent crude oil briefly surged past $100 a barrel this week, rising 10.1%, fueled by escalating Middle East tensions and threats of "major military punishment" from the U.S. President. This spike in oil prices led to Indian shares posting their worst weekly losses in months, with the Nifty 50 down 2.33% and the Sensex down 2.7%. Higher crude prices risk stoking inflation, widening trade deficits, and squeezing corporate profit margins, prompting concerns among analysts about a prolonged period of elevated prices. For Pakistan, sustained high crude oil prices could exacerbate imported inflation and pressure the USD/PKR exchange rate, potentially offering some support to local gold prices as an inflation hedge.
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