BPCL to HPCL: Indian OMCs slide up to 5% amid West Asia tensions

Higher crude oil prices could pose near-term earnings risks for oil marketing companies, city gas distributors, paints, agro-chemicals, building materials and tyre firms, analysts said

Shares of Indian Oil Market Companies (OMCs) tumbled up to 5 per cent on Monday as oil prices spiked after the US-Israel attacked Iran, leading to the death of Iranian Supreme Leader Ayatollah Ali Khamenei.  

Bharat Petroleum Corp. (BPCL) stock fell as much as 4.7 per cent to ₹367.1 per share, the steepest decline since June 13 last year. Shares of Indian Oil Corp (IOC) and Hindustan Petroleum Corp (HPCL) slid 5 per cent and 5.2 per cent, respectively. The Nifty Oil and Gas index was down 1.8 per cent.  

As of 9:35 AM, BPCL stock was trading 3.4 per cent lower compared to a 0.8 per cent fall in the Nifty50 index. Shares of IOC and HPCL were down 3.5 per cent and 1.8 per cent. So far this year, shares of BPCL and HPCL have fallen by 3.1 per cent and 13.7 per cent, respectively, while IOC has risen 8.4 per cent.  READ LATEST STOCK MARKET UPDATES LIVE

Israel-Iran Conflict

The US and Israel fired missiles across Iran on Saturday, with the Supreme Leader Ayatollah Ali Khamenei being killed. Iran responded with strikes against Israel, as well as US bases and other targets in states including Saudi Arabia, Qatar, the United Arab Emirates (UAE), Kuwait and Bahrain. 

US President Donald Trump said the forces sank nine Iranian naval ships and that combat operations would continue until all objectives were completed. Meanwhile, crude oil surged by the most in four years, with the Brent up as much as 13 per cent above $82 a barrel, according to Bloomberg.  

Higher crude oil prices could pose near-term earnings risks for oil marketing companies, city gas distributors, paints, agro-chemicals, building materials and tyre firms, said Antique Stock Broking. The brokerage added that with strong domestic growth and relatively benign inflation, crude at $80-85 per barrel for a quarter may not trigger a sharp correction. However, Indian equities could remain volatile in the near term.  ALSO READ | Oil price surge hits airlines, tyre stocks; IndiGo slides 7%, JK Tyres 16% 

Nearly 20 per cent of global oil flows through the Strait of Hormuz and over 40 per cent of India’s crude imports transit this route, creating material exposure, analysts said. Upstream oil producers such as ONGC and Oil India may benefit from stronger realisations.  

Brent crude has climbed to a seven-month high amid strike fears, said JM Financial. Its scenario analysis suggests limited retaliation may lift prices by $5-10 per barrel, direct damage to Iranian oil infrastructure by $10–12, disruption in the Strait of Hormuz above $90, and a broader regional conflict beyond $100 per barrel. 

 

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