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It was followed by Hindustan Petroleum Corporation (HPCL) which fell 7% to the day’s low of Rs 489.30 on the NSE. Meanwhile, Bharat Petroleum Corporation (BPCL) shares were down by 4.5% on the intraday basis.
Both IOC and HPCL have given multibagger returns of 128% and 116%, respectively over the past 12 months while returns by BPCL have been to the tune of 80% during this period.
Any appreciation in crude oil prices has a negative impact on the margins of the oil marketing companies.
The Nifty Oil & Gas index was one of the worst performers among sectoral indices as the 15-stock index fell by over 200 points or 1.85% at 1:35 pm with 13 stocks trading in the red. The gainers were Castrol India and Reliance Industries (RIL).
On Thursday, both benchmarks rose about 3% as Israeli forces bombed the southern border city of Rafah after Prime Minister Benjamin Netanyahu rejected a proposal to end the war in the Palestinian enclave. The tensions have kept oil prices elevated, with Brent and WTI both set to gain more than 5% for the week, Reuters reported. In another development regarding BPCL, Reuters reported that the company is avoiding purchase of Russian Sokol crude oil and is relying mostly on Urals, as payments are not being cleared by intermediate banks. The report was on the basis of a company source. The official declined to be identified due to the sensitive nature of the information, the report said.Presently there are no offers for Sokol grade crude and the Urals market has also become tight, the official said.
Urals oil, Russia’s flagship export blend loaded from its western ports, is mostly supplied to Asia due to a European Union embargo on Russian oil, with India becoming its top buyer for seaborne oil, this report said.
Oil stocks have been in action on account of Middle East tension. On January 29, oil stocks jumped up to 8% on fuel supply concerns in the aftermath of a missile attack on a Trafigura-operated fuel tanker in the Red Sea.
Also Read: YES Bank shares surge 9%, hit fresh 52-week high. Here’s why
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