Israel Iran Tensions: Israel attacked Iran’s important nuclear installations. After this, tremendous tension has increased in the Middle East countries. It is believed that the way the tension between the two countries is increasing, it will not only affect West Asia but India will also not be untouched by it. The reason for this is the Gulf of Hormuz. It is between Iran and Oman. It connects the Gulf of Persia to the Arabian Sea and Oman’s Gulf. In addition, it is a sensitive and an important path.

Hormus Gulf of Gully Oil Supply

The bay of this hormus can also be gauged from the fact that about 20 percent of the global oil supply passes through this path. Along with this, this is the only sea route for the Middle East oil producing countries, such as Iran, Iraq, Saudi Arabia, Qatar and UAE, so that they transport oil to the world market.

In such a situation, if the problem arises here, then the price of oil will go to the seventh sky. The supply chain will stop and the energy needs of the countries including India depend on it will have a direct impact.

What is the effect on India

The most important thing is that it can become a big danger for India, because India does about two -thirds of oil rectangles through this path. Apart from this, about half of LNG is also imported through this route.

In such a situation, if this path is closed, then India will have to find other routes immediately, which will create more costs and logistics challenges. India now has the option to consider other sources of energy and increase its reserve in view of the possibilities of increasing costs, so that such challenges can be faced in the coming time.

Oil price is predicted to increase

Brokerage firm JP Morger warned that if the struggle increases, then in that case the price of oil can increase to $ 120. This can also increase inflation and the current fiscal deficit of India. Also, everything will become expensive by increasing the price of oil.

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India pak tension impact on stock market: After the killing of 26 tourists on April 22 in Pahalgam, Jammu and Kashmir, the tension between India and Pakistan has increased considerably. This incident has done ghee in the fire amid the sourness in the relationship with the initiative. After this, India took many tough steps including canceling the Indus Water Agreement and reduced the number of diplomats from neighboring countries, on the other hand, Pakistan is also taking retaliation. This tension between the two countries is having a direct impact on the stock markets.

Market experts believe that if the tension continues to increase in this way, then there will be uncertainty in the market and there will be an atmosphere of fear in the interest. It is worth noting that at the rise of seven consecutive days last week, the Indian stock market got a break when this tension between the India and Pakistan increased after the incident of Pahalgam.

Effect of tension on the stock market

Talking about the last week, the BSE Sensex closed at 79212.53 level while the Nifty 50 saw an increase of one percent. The Nifty 50 had climbed about 0.80 per cent to close at 24,039.35. If we believe the report of brokerage firm Anand Rathi, then about twenty four years ago, when Vajpayee had a government at the Center, the Indian Parliament was attacked in 2001. If you leave the situation at that time, the Indian stock market had never seen a decline of more than 2 percent during the stress of India and Pakistan.

However, even at that time there was a greater impact on the market on the market, especially the fall of about 30% in the global factor, especially S&P 500. This report further states that on the basis of historical experiences and valuation of existing global risk, if there is further increase in tension between India and Pakistan, then the Nifty 50 will not see a decline of more than 5 to 10%.

Which shares have more impact

The report of the brokerage firm further states that on an average, you can see a correction of up to 7 percent in the stock market during the average geo-political tension. Significantly, after the attack on tourists in Pahalgam, there has been a tremendous development in the shares of aviation companies and hotels. Many investors are scared that the incident of Pahalgam will have a bad effect on tourism and will affect the business of hotel and aviation companies. This is the reason why these stocks saw vigorous selling.

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