Mumbai, March 19 (IANS) Indian stock markets witnessed a sharp fall on Thursday over rising global tensions and a sudden spike in oil prices, as the ongoing conflict involving the US, Israel and Iran disrupted key energy infrastructure. The benchmark indices, Nifty and Sensex, ended the session with steep losses as both indices logged their steepest single-day fall in nearly two years.The Nifty dropped 775.65 points, or 3.26 per cent, to close at 23,002.15, while the Sensex fell 2,496.89 points, or 3.26 per cent, to settle at 74,207.24.The sell-off came as crude oil prices surged sharply amid fears of supply disruptions.

Brent crude jumped nearly 11 per cent to $119.5 per barrel after reports indicated that Saudi Arabia halted oil loading at the Yanbu port following damage to key refineries.Drone strikes reportedly hit Samref’s facilities, while several refineries of Aramco caught fire during the escalation in the US-Iran conflict.Market volatility also spiked significantly during the day. The India VIX surged over 22 per cent during the session -- reflecting heightened uncertainty among investors.It eventually closed nearly 22 per cent higher, indicating that nervousness may continue in the near term.The broader markets also mirrored the weakness in benchmark indices. Midcap and smallcap stocks saw notable declines, with both indices falling around 3 per cent each.

Sector-wise, the auto sector was the worst hit, followed by financial services and IT stocks, which also saw heavy selling pressure.The sharp rise in oil prices tends to impact auto companies due to higher fuel costs, while financial and IT stocks often react to global uncertainties.Analysts said that the overall market mood remained cautious, as investors reacted to geopolitical developments and worried about the potential economic impact of prolonged conflict and rising energy costs.

/IANS