With the global economy still nursing wounds -- the Indian economy has put up a brave face as it recuperates from the Russia-Ukraine standoff which has picked a rather inopportune moment to manifest.

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It is almost imperative that any disruption in the Russian region will be followed by concerns around crude oil prices given its dominant position as a producer and the world’s critical dependency on the same.

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We spoke to Nirav Karkera, Head of Research, Fisdom to decode the impact of the Russia-Ukraine standoff on crude oil and other sectors:

Oil prices have been sustaining at levels a tad bit shy of the terrifying $100/bbl-mark.

While initial estimates set the stage for a steeper increase in prices, progress on the Iranian nuclear deal and the expectation of a consequent increase in oil supply from the region seems to have capped bubbling prices.

India’s high dependence on imports for oil needs is not news, but what’s interesting is that the impact on India won’t be a straightforward, one-to-one supply chain disruption challenge.

Though India’s crude import is diversified significantly away from Russia, it is not insulated from the hike in prices of crude oil that will be spurred by a cut in production by or fractures in lines of crude supply from Russia.

Increment in crude prices will have ripple effects and negative outcomes for most facets of Indian macroeconomics.

Higher crude prices will not just run the import bill and commodity trade balance up but also the subsidy bill for LPG and kerosene which can be expected to snowball and deal a solid blow to the Current Account Deficit situation.

India is already reeling under inflationary pressure like most parts of the world, and the fact that this price increase will only accentuate troubles on this front.

The quest for alternative suppliers of critical food items of sunflower oil, wheat and corn is expected to worsen the already-hot world food prices and related inflation.

An intensified inflation and further troubled national accounts situation will truly test RBI’s ability to hold onto the accommodative stance which, by the way, may already be in a precariously fragile state.

Sectors of prominence in India’s bilateral trade with Russia and Ukraine, especially those involved in defence manufacturing, pharmaceuticals, and certain agriculture products will be among the ones in direct line of impact by the crisis.

If a worsening situation in the Russia-Ukraine crisis rubs U.S. and NATO the wrong way, one could expect a series of economic sanctions which would probably turn out to be mutually detrimental to all parties involved.

India’s diplomatic relationships with concerned nations will be put to test which may not exactly result in India coming out politically unscathed.

The India chapter will be bookmarked only to be picked eventually by the emotionally pained nation – whichever it turns out to be.

As the geopolitical upheaval paints a risk-off environment, global investors can be expected to dump stocks fast and growth stocks faster while grabbing a bite only of scrips that seem to offer a strong value buying opportunity.

Meanwhile, back home, domestic institutions are lapping up value opportunities presented by panic-stricken FIIs.

The rate hike cycle in the U.S., global inflation, safe-haven preference and RBI’s seemingly stretched accommodative stance can be expected to have a deprecative effect on the INR versus the greenback.

While the currency depreciation is superficially in favour of India’s export agenda, it is not quite the form of a blessing.

(Disclaimer: The views/suggestions/advices expressed here in this article is solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)