Shares of oil marketing companies witnessed selling pressure today, falling as much as 6 per cent after the government raised excise duty on petrol and diesel by Rs 1.50 a litre.
Shares of all the three PSU OMCs - Indian Oil, Bharat Petroleum and Hindustan Petroleum Corporation - took a knock.
HPCL tumbled 6.11 per cent to settle at Rs 541.80, while BPCL lost 4.47 per cent to Rs 729.15 at the BSE.
Similarly, shares of IOC plunged 4.40 per cent to Rs 346.40.
"OMC (oil marketing companies) stocks witnessed profit booking ....," said Kiran Kumar Kavikondala, Director & CEO, WealthRays Securities.
From the BSE oil and gas index stocks, Cairn India lost 3.62 per cent, OIL (2.12 per cent), ONGC (2.03 per cent).
The oil and gas index ended the day 1.63 per cent lower at 10,723.99.
Government today raised excise duty on petrol and diesel by Rs 1.50 a litre, but consumers will be spared of any price increase as oil firms would adjust it with a reduction in retail rates due this weekend.
The move will boost government revenue by about Rs 13,000 crore to contain budget deficit.
With a steep fall in international crude prices, oil marketing firms were expected to cut retail fuel prices by about Re 1 a litre with effect from November 16 after a fortnightly review.
Indian Oil Corp, the nation's largest fuel retailer, said the excise duty hike will not be passed on to consumers and will be adjusted against the reduction in rates that was due this weekend.
