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The Indian rupee is expected to open higher on Wednesday, supported by a pullback in oil prices after U.S. President Donald Trump indicated a possible peace deal with Iran. 

Expectations of steps to boost dollar inflows were seen as further relieving pressure on the currency, traders said.

The rupee is expected to open in the 95.00-95.04 range, traders said, after settling at 95.28 against the U.S. dollar on Tuesday. 

Brent crude July futures extended losses in the Asian session, slipping to about $108 per barrel after U.S. President Donald Trump unexpectedly said he would briefly pause an operation to escort ships through the Strait of Hormuz, citing progress toward a comprehensive agreement with Iran. 

He did not provide details, and there was no immediate response from Tehran.

Oil markets continue to swing with headlines about U.S.-Iran tensions, which have often lacked clarity. Fears of renewed escalation and pressure on the ceasefire rose after Trump said he would escort stranded tankers through the strait.

The ceasefire between the US and Iran appears to be holding despite recent escalation in the Persian Gulf, ING Bank said in a note, and Trump pausing the operation should put more downside pressure on oil.

The rupee, in turn, has been taking cues from oil prices, with rallies in crude exerting more pressure than the relief offered by pullbacks. The currency hit an all-time low of 95.4325 on Tuesday.

Persistent pressure on the rupee is fuelling expectations of measures to boost dollar inflows. Reuters reported the Reserve Bank of India is studying ways to mobilise such flows, while Bloomberg News reported that the central bank is weighing a plan for state-owned lenders to sell foreign-currency bonds.

As seen in past episodes of rupee stress, the probability of policymakers considering unconventional external capital?raising measures is rising, ANZ Bank said in a note.