RIL, ONGC, Oil India slips up to 7% as crude oil slips below $70/barrel

The weakness in the oil prices came after US President Donald Trump imposed 'reciprocal' tariffs' on trading partners. He also announced a 10 per cent tariff on all countries

Upstream oil companies-- Oil and Natural Gas Corporation (ONGC),  Reliance Industries (RIL), Oil India-- stocks slipped 7.2 per cent in trade on Friday, April 4, 2025. The stocks fell after crude oil prices declined below $70 per barrel. 

 

Around 12:13 PM, ONGC shares were down 6.6 per cent, RIL shares were down 4.3 per cent and Oil India was down 6.4 per cent. In comparison BSE Sensex was down 1.02 per cent at 75,520.89. Upstream oil companies depend on the price at which crude oil is sold. If crude oil prices drop, the revenue generated from oil production decreases, which can directly impact the profitability of oil exploration and production companies.

 

 

The weakness in the oil prices came after US President Donald Trump imposed 'reciprocal' tariffs' on trading partners. He also announced a 10 per cent base tariff on all countries. 

 

US' reciprocal tariffs, Trump said, aim to promote manufacturing in the US and provide Americans a level playing field against other countries that have been indulging in "years of unfair trade practices" by imposing high tariffs and other non-trade barriers on US goods, blocking the US’ access to various global markets. 

 

The US President went ahead with stringent tariffs against more than 180 countries despite several economists’ issuing warnings that higher tariffs could, yet again, flare up inflation in an economy that is making slow progress towards achieving its long-term inflation target of 2 per cent.

 

Even though imports of oil, gas and refined products were exempted from Trump's sweeping new tariffs, but the policies could stoke inflation, slow economic growth and intensify trade disputes, weighing on oil prices.

 

In another blow, Organisation of Petroleum Exporting Countries and their allies (Opec+) also advanced their plan for oil output increases, with the organisation now aiming to return 411,000 barrels per day to the market in May, up from 135,000 bpd as initially planned which also triggered a fall in oil prices. 

 

According to Reuters, the increase will reduce fears arising from any disruption to Iranian supply as Trump restores maximum pressure on Tehran, also an OPEC member. The US President, who has called on Opec to lower prices since starting his second term, may visit Saudi Arabia as soon as next month.

 

The May hike is the next increment of a plan agreed by Russia, Saudi Arabia, UAE, Kuwait, Iraq, Algeria, Kazakhstan, and Oman to gradually unwind their most recent output cut of 2.2 million bpd, which came into effect this month.