Shares of oil marketing companies (OMCs) surged in early trade on May 25 after petrol and diesel prices were raised for the fourth time in less than 10 days, boosting sentiment around the sector. After the latest hike on May 25, petrol prices went up by Rs 2.61 per litre, while diesel became costlier by Rs 2.71 per litre.
With this, petrol and diesel prices have cumulatively increased by nearly Rs 7.50 per litre since fuel rates were first revised on May 15 after a gap of almost four years. Fuel prices were first raised by Rs 3 per litre on May 15, followed by a 90 paise per litre hike on May 19. On May 23, petrol prices were hiked by a further 87 paise per litre, while diesel rates were increased by 91 paise per litre.
Following the latest hike, petrol prices in Delhi stood at Rs 102.12 per litre, while diesel was priced at Rs 95.20 per litre. In Mumbai, petrol cost Rs 111.21 per litre and diesel Rs 97.83 per litre. Kolkata saw petrol prices at Rs 113.51 per litre and diesel at Rs 99.82 per litre. In Chennai, petrol was priced at Rs 107.77 per litre, while diesel retailed at Rs 99.55 per litre.
HPCL, BPCL, IOCL Share Price Rally
Among OMCs, Hindustan Petroleum Corporation Ltd (HPCL) led the gains, rising as much as 5.87 per cent to Rs 412.55 apiece on the NSE. Bharat Petroleum Corporation Ltd (BPCL) climbed 4.45 per cent to Rs 308.70, while Indian Oil Corporation (IOC) advanced 3.88 per cent to Rs 144.88. In contrast, shares of upstream oil exploration companies declined, with ONGC and Oil India falling between 1.5 per cent and 2.5 per cent in early trade.
The Nifty Oil & Gas index, which captures the performance of the stocks belonging to oil, gas and petroleum industry, rose up to 1.66 per cent to quote above 11,500 level. The index is still about 6 per cent lower from pre-Iran war levels.
Petrol, Diesel Rate Hike Comes Amid Easing Crude Oil Prices
The latest increase in petrol and diesel prices comes even as crude oil prices witnessed a sharp decline amid growing optimism over a potential peace agreement between the US and Iran, which could ease supply concerns and reopen the strategically important Strait of Hormuz.
US President Donald Trump said Washington and Iran had “largely negotiated” an understanding on a peace deal. However, both countries are still divided on several key issues, and Trump later said the US would not rush into any agreement.
Following these developments, crude oil futures on the Multi Commodity Exchange (MCX) fell up to 6 per cent to Rs 8,622 per barrel. At 10:30 AM, MCX crude oil futures were trading 5.20 per cent lower at Rs 8,691 per barrel.
The international benchmark Brent crude futures declined 6 per cent per cent to $94.22 per barrel, and the US benchmark West Texas Intermediate (WTI) crude futures declined 6.50 per cent to $90.34 per barrel. Brent crude fell to its lowest level since April 22, while WTI crude touched its weakest level since May 7.
