Shares of the domestic oil marketing companies such as IOC, BPCL and HPCL hit multi-month lows as crude oil prices hovered near a four-year high as one of the states of Persian Gulf countries nudged for higher prices by cutting short the supplies. Shares of the big-three oil marketers went on to extend losses on Thursday after yesterday’s decline on the aforementioned concerns. Shares of Bharat Petroleum Corporation were the biggest losers among the pack of three oil companies on Indian bourses today.
The stock of BPCL tanked as much as 6.18% to a 19-month low of Rs 380.15; the stock of HPCL dropped 6.13% to Rs 14-month low of Rs 300 while the share of IOC slumped 4.15% to a fresh 15-month low of Rs 158.1 on Thursday. Shares of HPCL, BPCL and IOC were at their respective lowest levels since early-January 2017, late-September 2016 and late-December 2016.
Oil prices rose on Thursday to their highest in over three years as US crude inventories declined and as top exporter Saudi Arabia pushes for higher prices by continuing to withhold supplies, Reuters said in a report. Brent crude jumped to $74.15 per barrel, up by 0.91%, mounting the strongest since November 2014 while US West Texas Intermediate (WTI) crude surged about 0.86% to $69.06 per barrel. “The rally is due to the stock data last night and risk premiums from geopolitical tensions in the Middle East over the last few weeks, but these risk premiums are quite short-lived and investors will likely be normalizing prices lower again as the tensions ease,” Reuters reported citing Barnabas Gan, an OCBC analyst.
The Organization of the Petroleum Exporting Countries (OPEC) and their respective partners are likely to meet in Jeddah, Saudi Arabia, on 20 April 2018 with regard to a supply reduction pact. The OPEC will then meet on 22 June to review its oil production policy.
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