As the Middle East crisis escalates, crude oil prices could surge to $150 or $200 a barrel if the near-closure of the Strait of Hormuz continues over the next six to eight weeks. The disruption is a result of the ongoing war involving the US, Israel, and Iran, which has already prompted Persian Gulf producers to cut millions of barrels of daily supply.According to energy-market consultancy FGE NexantECA, the impact on the global oil market could be enormous. “Every week, 100 million barrels of oil is not going through, and every month, 400 million barrels are not going through,” Chairman Emeritus Fereidun Fesharaki told Bloomberg on Tuesday. “So, within a period of time, these losses to the market will be astronomical,” he said. Fesharaki highlighted that the physical reality of supply disruptions would determine oil prices, rather than political statements.“The market will choke, and the prices will go up. It doesn’t matter what the president says on the political front,” he added. His statement comes as US President Donald Trump has earlier suggested possibility to end the conflict. Oil prices have already surged sharply this month amid the conflict, with Brent crude climbing above $110 per barrel and US West Texas Intermediate (WTI) crude trading above $100. Brent crude rose $2.26, or about 2 per cent, to $115.04 a barrel in early trade, after hitting its highest level since March 19 in the previous session. US WTI crude gained $3.10, or around 3 per cent to $105.96 a barrel, marking its highest level since March 9.Analysts warn that if the Strait of Hormuz remains effectively closed, the global oil market could face further shocks, potentially pushing prices even higher.

Indian IT sector majors – Tata Consultancy Services (TCS), Wipro, Infosys, HCL Tech, and Tech Mahindra – have seen their bench strength drop by 25% in the last two years. Bench strength acts as a traditional reserve workforce with an aim to be a cushion during demand fluctuations. This buffer has contracted sharply, declining by roughly one-fourth over the past two years, and industry observers believe it may not return to earlier levels even if growth revives.Across major firms such as TCS, Infosys, Wipro, HCLTech and Tech Mahindra, the number of employees on the bench has dropped by around 75,000, falling from nearly three lakh to about 2.25 lakh, according to industry estimates cited by experts in an ET report.The proportion of unassigned employees has also narrowed considerably. “The bench across IT services is currently between 8-15% of the workforce compared to over 20% earlier,” said Pareekh Jain, CEO of EIIRTrend. Similarly, TeamLease Digital estimates the current range at 8-12%, down from 20-30% in previous years.

Deeper Shift In IT Sector Bench Strength Trends

Historically, companies maintained a sizeable bench by hiring in anticipation of future projects, ensuring that skilled personnel were readily available when demand materialised. This approach was viable during periods of rapid expansion. However, firms are now moving away from that model and tightening workforce utilisation.Companies that once operated with 4-5% of employees on the bench are now targeting significantly lower levels, often between 1% and 1.5%. In some cases, stricter policies have been introduced. For instance, in TCS bench duration has been capped at around 35 days annually, after which performance evaluations are initiated, and employees who remain unallocated may be asked to exit.Experts indicate that this shift is not merely cyclical but reflects a deeper structural change. “The concept of bench does not make sense unless an IT services firm can predict skill or role-based demand with 90% accuracy three months in advance,” said Gaurav Vasu, founder of UnearthInsight.Slower industry growth has been identified as the primary driver behind this contraction, rather than technological disruption. “Low growth is the bigger factor in bench reduction today. When growth returns, firms may not need to rebuild their bench because local hiring in different countries has increased significantly over the last five to six years,” Jain said.Over the past two years, hiring patterns have undergone a clear shift. Demand for traditional mid-level delivery roles has declined by roughly 20–30 per cent, while requirements for skills in artificial intelligence, generative AI, data, and cloud technologies have increased by about 30–40 per cent across the same firms, according to Neeti Sharma, CEO of TeamLease Digital.Global capability centres, however, present a more varied trend, with mid-level recruitment showing relatively greater resilience. “Leadership hiring has grown in line with overall demand, with the share of such roles increasing from around 15% in 2024 to around 20% in 2025. What has changed is the nature of these roles. Today, more than 50% of job demand is driven by emerging skills, especially in AI, cloud, and platform engineering,” said Kapil Joshi, CEO of IT staffing at Quess Corp. In contrast, hiring at the entry level has declined by around 30–35 per cent during the same period, he added.The changes are also affecting how quickly professionals are placed. The average time required to assign a benched engineer with 8–12 years of experience has lengthened to 60–90 days, compared with 30–45 days earlier, Sharma told ET.

Salary Trends

Compensation trends are diverging as well. Premiums for lateral hiring in non-AI roles have reduced to 10–20 per cent, down from 25–35 per cent in FY 2022–23. In contrast, professionals with AI capabilities continue to command premiums of 20–30 per cent and tend to secure offers more quickly, Sharma said. According to Quess data, premiums for generative AI roles range between 15–40 per cent depending on the position.The broader career structure within IT services firms is also evolving. “The people manager role is not disappearing, but its responsibilities are narrowing, shifting toward revenue expansion and profitability management away from headcount oversight,” Vasu said.

The United Nations Development Programme (UNDP) warned on Monday that the ongoing war by the United States and Israel against Iran could result in a significant economic setback for the Middle East, with Arab nations potentially losing up to $200 billion in economic growth.

The ongoing conflict has already driven up global energy prices, further straining the global economy. An earlier UN report highlighted that the effective closure of the Strait of Hormuz has contributed to rising food and fertiliser prices. This trend is expected to disproportionately affect poorer nations.

In a report issued today, titled ‘Military Escalation in the Middle East: Economic and Social Implications for the Arab States region‘, the UNDP warned: “At the regional level, GDP is estimated to decline by approximately 3.7-6%, equivalent to a contraction of roughly $120-194b (in constant 2015 USD), with investment contracting more sharply, reflecting heightened uncertainty and reduced capital formation.”

The report warned that even if the military escalation ended quickly, the socio-economic consequences for the region would be profound. The overall loss could lead to a rise in the regional unemployment rate by as much as four percentage points, resulting in the loss of approximately 3.6 million jobs. Additionally, it was estimated that up to 4m people could be pushed into poverty due to the economic downturn.

Read: After Spain, Italy also refuses airbase access to US military aircraft involved in Iran war

Abdallah Al Dardari, the UN assistant secretary-general leading the UNDP Arab states bureau, described the situation as a “crisis” that was raising alarm bells for countries in the region.

The Gulf Cooperation Council countries and the Levant were expected to be particularly hard hit, with each region projected to lose more than 5.2% of its GDP.