The stock market witnessed a notable surge in the shares of key oil and gas companies, including Mangalore Refinery and Petrochemicals Limited (MRPL), Chennai Petroleum Corporation, Oil India Limited (OIL), Oil and Natural Gas Corporation (ONGC), and Adani Total Gas. These stocks climbed by up to 6% during intraday trading, reflecting positive momentum in the energy sector.
Factors Driving the Surge:
- Decline in Global Oil Prices: A marginal dip in global crude oil prices has positively impacted the profitability outlook for oil and gas companies. Brent crude futures were trading at $70.92 per barrel, while U.S. West Texas Intermediate crude stood at $67.60 per barrel, as per recent reports.
- Government Policy Changes: The Indian government recently reduced the windfall tax on diesel exports to ₹0.50 per liter and eliminated the levy on jet fuel exports. This policy shift has provided a boost to companies like MRPL and Chennai Petroleum, which are heavily involved in refining and exports.
- Improved Market Sentiment: The Organization of the Petroleum Exporting Countries (OPEC) maintained its forecast for strong global oil demand in 2025, citing increased air and road travel. This has bolstered investor confidence in the sector.
Performance Highlights:
- MRPL shares recorded the highest gain, surging by 6.86% during intraday trading.
- Chennai Petroleum and OIL saw increases of 3.16% and 2.29%, respectively.
- ONGC and Adani Total Gas also posted gains, contributing to the overall positive trend in the Nifty Oil and Gas index.
The rally in these stocks underscores the resilience of the oil and gas sector amid fluctuating global market conditions. Analysts remain optimistic about the sector’s growth prospects, driven by favorable government policies and steady demand for energy products.
Investors are advised to monitor developments in global oil prices and domestic policy changes, as these factors will continue to influence the performance of oil and gas stocks in the coming months.
