By Bharath Rajeswaran and Vivek Kumar M

(Reuters) - Indian stock benchmarks logged their biggest daily losses in more than two weeks on Thursday as escalating U.S.-Iran tensions pushed crude prices higher and dampened sentiment in the world's third-largest oil importer.

The Nifty 50 (.NSEI) fell 1.41% to 25,454.35 and the BSE Sensex (.BSESN) shed 1.48% to close at 82,498.14. The decline wiped out gains from the last three sessions.

India's Nifty 50 logs steepest single-session drop since union budget on Feb 1

All 16 major sectors fell, while the small- (.NIFSMCP100) and mid-caps (.NIFMDCP100) lost 1.3% and 1.6%, respectively, snapping a three-day winning streak.

Brent crude oil prices rose 1% to $71 per barrel on Thursday, building on the previous day's 4% jump amid heightened military activity in the key oil-producing region.

"For India, this is worrisome because we are a major crude importer and any sustained rise in oil prices feeds straight into market sentiment and the economy through imported inflation," said Aishvarya Dadheech, founder and chief investment officer at Fident Asset Management.

Dadheech added that geopolitical tensions became the "perfect trigger" for selling as investors were already sitting on three consecutive sessions of gains.

Oil marketing firms Indian Oil Corp (IOC.NS), BPCL (BPCL.NS), and HPCL (HPCL.NS) dropped 2.5%, 3.5% and 5%, respectively.

In contrast, upstream oil companies, such as ONGC (ONGC.NS) and Oil India (OILI.NS), which tend to benefit from higher prices, gained 3.8% and 5.1%.

Oil-to-telecom conglomerate Reliance Industries (RELI.NS) shed 2.2%, while financials (.NIFTYFIN) lost 1.4%, led by 1% and 1.4% drops in private lenders HDFC Bank (HDBK.NS) and ICICI Bank (ICBK.NS).

IT stocks (.NIFTYIT), which rose as much as 1.5% earlier in the session, gave up gains and settled 1.1% lower in a weak market. The index has lost 15% this month amid worries over AI-led disruption.

Reporting by Bharath Rajeswaran and Vivek Kumar M in Bengaluru; Editing by Janane Venkatraman, Sonia Cheema and Ronojoy Mazumdar

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