Oil & Gas Stocks Surge as Falling Crude Prices Boost Market Sentiment

Market Performance

Shares of major oil marketing companies (OMCs) and oil & gas giants soared on June 11, driven by declining crude oil prices. The Nifty Oil & Gas index surged 1.7% in early trade, reflecting strong investor optimism.

Key gainers included:

• HPCL – Up 4% at ₹421
• BPCL – Up 4% at ₹332
• IOC – Gained 2.5% to ₹146
• Reliance Industries – Jumped 1.6%, hitting an 8-month high at ₹1,461
• ONGC – Top Nifty gainer, rising 2%

Why Are Oil & Gas Stocks Rising?

1. Falling Crude Oil Prices

• Brent Crude dipped 0.3% to $66.68/barrel
• US WTI Crude fell 0.3% to $64.82/barrel
• The US Energy Information Administration (EIA) predicts further declines:
  • Brent to average $61 in 2025 (down from $64 in May)
  • $59/barrel expected in 2026

2. OPEC+ Production Increase

• OPEC+ plans to gradually ease supply concerns by raising output.
• This benefits Indian refiners by improving gross marketing margins on retail fuel.

3. US-China Trade Talks Impact

• Assessing the outcome of recent US-China trade discussions.
• Weak Chinese demand and lower OPEC+ production continue to pressure oil prices.

Key Company Updates

Reliance Industries

• Shares hit an 8-month high at ₹1,461.
• The top gainer on Sensex contributed significantly to the index's rise.

HPCL, BPCL, and IOC

• HPCL & BPCL led gains with 4% jumps.
• IOC rose 2.5%, benefiting from improved refining margins.

ONGC & Oil India

• ONGC was the top Nifty gainer, up 2%.
• Oil India surged 3% to ₹449 despite declines in the crude price.

Summary

Falling crude oil prices and positive OPEC+ supply adjustments have fueled a rally in oil & gas stocks. Reliance Industries, HPCL, BPCL, and IOC emerged as top performers, with the Nifty Oil & Gas index climbing 1.7%. Investors remain optimistic as global oil inventories rise, potentially keeping prices subdued in the near term.