U.S. president Donald Trump spoke with prime minister Narendra Modi on Tuesday to discuss the rapidly evolving situation in West Asia, focusing on energy security and the need to keep the Strait of Hormuz open.

The call comes amid heightened geopolitical tensions following the ongoing US–Iran conflict, which has disrupted global energy flows and triggered sharp volatility in financial markets.

Focus on Strait of Hormuz and energy flows

According to the US Ambassador to India Sergio Gor, the leaders discussed the importance of maintaining open shipping routes through the Strait of Hormuz, a critical chokepoint that handles a significant share of global oil and liquefied natural gas supplies.

"President Donald Trump just spoke with Prime Minister Modi. They discussed the ongoing situation in the Middle East, including the importance of keeping the Strait of Hormuz open," Gor posted on X.

The narrow waterway has been at the centre of the crisis, with disruptions severely impacting global energy markets and raising concerns over supply shortages.

Confirming the call, PM Modi said the two leaders had a “useful exchange of views” on the crisis and agreed to remain in touch on efforts aimed at restoring peace and stability in the region.

High-level diplomatic engagement intensifies

The Trump–Modi call follows a series of high-level diplomatic engagements between India and the United States.

External affairs minister Subrahmanyam Jaishankar held detailed discussions with U.S. secretary of state Marco Rubio a day earlier, focusing on the West Asia conflict and its impact on the global economy, particularly energy security concerns.

These back-to-back interactions indicate increasing coordination between the two countries as risks to global trade and energy supplies mount.

Conflicting narratives on U.S.–Iran talks

The development also come against a backdrop of sharply diverging narratives between Washington and Tehran.

Trump has claimed that the U.S. and Iran have held “productive conversations” and even announced a five-day halt on planned strikes on Iranian energy infrastructure, citing progress in talks.

However, Iran has categorically denied any negotiations, with senior officials dismissing the claims as misinformation.

At the same time, reports suggest that indirect backchannel diplomacy is underway, with countries such as Turkey, Egypt and Pakistan facilitating communication between the two sides.

Modi warns of ‘serious consequences’

Addressing parliament earlier, PM Modi flagged the broader economic risks posed by the conflict, warning that a prolonged crisis in West Asia could have “serious consequences” for the global economy and India.

He stressed that disruptions to energy supplies and trade routes could pose significant challenges, while reiterating India’s stance in favour of dialogue and de-escalation.

The prime minister also noted that India remains in contact with key stakeholders, including the U.S., Iran and Israel, as part of efforts to stabilise the situation.

Markets react to shifting geopolitical signals

Financial markets have reacted sharply to these developments.

Oil prices, which had surged on fears of supply disruption, fell sharply on expectations of normalcy after Trump's announcement on Monday.

Global equities rebounded as investors priced in potential de-escalation, even as uncertainty remains elevated due to conflicting signals from key stakeholders.

Indian equity benchmarks also staged a sharp rebound on Tuesday, with Sensex and Nifty recovering strongly after the previous session’s sell-off that wiped out nearly ₹14 lakh crore of investor wealth.