Oil Marketing Stocks Jump In Early Trade On Ceasefire Signal
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Stocks of oil marketing companies jumped up to 9% in early trade following a drop in crude prices on a US-Iran ceasefire linked to the reopening of the Strait of Hormuz.
Shares of Hindustan Petroleum Corporation Limited (HPCL), Indian Oil Corporation Ltd (IOCL), and Bharat Petroleum Corporation Limited (BPCL) rallied up to 9% on Wednesday after global crude prices dropped sharply following a ceasefire announcement between the US and Iran.
At around 10:12 am, HPCL shares were trading at ₹358.95 a piece on the National Stock Exchange (NSE). At the same time, IOCL shares and BPCL shares were trading at ₹142.15 and ₹295.10, respectively.
Ceasefire Drives The Surge
The surge came after US President Donald Trump said a two-week ceasefire had been agreed, linked to the reopening of the Strait of Hormuz. The Strait handles about one-fifth of global oil flows. Following the ceasefire announcement, Brent Crude and West Texas Intermediate (WTI) also recorded a sharp fall.
At around 10:20 am, Brent crude June 2026 futures were trading at USD 95.61 per barrel, down by 12.50%, while WTI May 2026 futures declined by almost 14% to USD 97.21 per barrel.
Lower Crude Brings Cost Relief
The move matters immediately for oil marketing companies (OMCs). These firms depend heavily on crude as a raw material. A fall in prices reduces input costs and can support margins. The latest drop offers short-term relief after weeks of elevated prices driven by geopolitical tensions.
Brokerages Flag Price Band, Ongoing Risks
However, international brokerages said crude could find support in the $85–$90 range even if tensions ease. They feel markets may continue to price in risk around the Strait with Iran threatening the route more frequently, even after a peace deal.
Also Read - HFCL Shares In Focus After Subsidiary Wins ₹1,366-Crore Order
Upstream Oil Companies Record Decline
While the ceasefire brought cheers for OMCs, it resulted in a decline of share prices for upstream oil companies like Oil and Natural Gas Corporation (ONGC) and Oil India Ltd. At around 10:27 am, ONGC and Oil India shares were down by 3.07% and 3.82% on the NSE, respectively.
Sources:
The Economic Times
Business Standard
This article is for informational purposes only and should not be considered investment advice from Kotak Neo. For compliance T&C and disclaimers, Visit www.kotakneo.com/disclaimer
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