India-Pakistan tensions not to impact crude prices as supply chains are intact, say experts

Rising tensions between India and Pakistan are not expected to have an immediate effect on global crude oil prices, according to market experts cited on May 7. This comes after Indian forces reportedly targeted terror camps across the border as part of Operation Sindoor. Despite the military action, crude oil markets remained stable, with Brent crude hovering around $62.67 per barrel, only a slight increase from the previous day’s close of $62.15.

Hitesh Jain, lead analyst at Yes Securities, noted that unless the situation escalates into a full-scale war, which appears unlikely at this stage, there would be no significant impact on India's economy.

Concerns remain over a potential escalation, especially after Pakistan vowed to respond "at a time and place of its choosing." However, analysts emphasize that crude markets typically react sharply only when key oil-producing regions or global shipping routes are disrupted as seen during conflicts in the Middle East and the ongoing Russia-Ukraine war.

So far, supply chains remain unaffected, and the market response has been muted, reflecting confidence that the situation will not spiral into a broader regional crisis.