The  rupee slumped to a new low on March 9, closing at 92.34 against the US dollar, as crude surged above $100 a barrel. The Reserve Bank of India (RBI) likely stepped in aggressively to arrest the fall in the rupee, as crude blew past $115, traders said.

The currency ended at Rs 92.34 after closing the previous session at Rs 91.74. It moved in a range of more than 50 paise through the day.

The US-Israel and Iran conflict, which is now in its second week, is showing no signs of coming to an end and even desalination and fuel assets are being targeted. The intensifying conflict has rattled global businesses and energy prices have been jumping almost every day, leading to fears of an oil shock.

The benchmark Brent crude has jumped more than 20 percent since the start of the month.

He was referring to the Strait of Hormuz, through which 40 per cent of India’s energy imports arrive and has been virtually shut off since the start of the war on February 28.

At 3.30 pm, the Brent was trading at around $103, coming down from the initial level of near-$120 early in the day. This crude cooled on reports that the G7 countries were considering releasing 400 million barrels of oil reserves in response to a potential oil supply and price shock.

Higher Brent is a negative for India, which meets more than 85 percent of its energy needs through imports and can widen the country’s currency account deficit.

"The Reserve Bank of India has aggressively defended the rupee, deploying an estimated $12 billion across spot and offshore non-deliverable forwards (NDF) markets last week, traders said. The central bank likely intervened on March 9 as well to cushion the fall.

The rupee could fall to Rs 93 level soon, should Brent continue to remain under pressure, which could prompt more RBI intervention, traders said.