HPCL, BPCL, IOC shares surge up to 4% as oil falls below $100 amid hopes for Iran-US war cooling off

The shares of oil marketing companies jumped up to 4% on Wednesday as oil prices dropped below the crucial $100 per barrel mark amid rising hopes for the war between Iran and US ending soon, following comments from the respective countries' leadership.

Brent crude futures dropped around 5% to trade at $99.06 per barrel, as seen at 12.48 pm IST. WTI Crude, meanwhile, fell over 4% to $97 per barrel.

Additionally, prices of premium petrol XP100 was hiked by Rs 11 per litre, rising from Rs 149 to Rs 160, while jet fuel (ATF) has crossed Rs 2 lakh per kilolitre.


Oil prices crossed the crucial $100 mark in March after the closure of the Strait of Hormuz, marking the first time since Russia's invasion of Ukraine in 2022. Front-month Brent futures hit a record monthly gain ‌of 64% in ⁠March, Reuters cited LSEG data dating back to June 1988.

March massacre in OMC shares

The sharp surge in oil prices earlier had led to a sharp selloff in the OMC stocks, which were among the most exposed counters to the raging war and the resulting rally in oil prices. The shares of Indian Oil Corporation (IOC) declined around 27% in one month, while Bharat Petroleum Corporation (BPCL) fell more than 25% and Hindustan Petroleum Corporation (HPCL) dropped 22% as rising oil prices spooked investors about the possible impact on margins.

Moody's Ratings had said that India’s state-owned oil marketing companies (OMCs) could face heightened margin pressure and cash-flow volatility as global energy prices rise while domestic fuel prices remain largely unchanged.

The agency said that the country’s three largest fuel retailers i.e. IOC, BPCL, and HPCL, would likely absorb higher input costs stemming from elevated global crude and gas prices. When international oil prices rise, procurement and refining costs increase sharply while retail prices for petrol and diesel remain unchanged, compressing marketing margins and weakening operating cash flows.

Iran-US war to end soon?

However, investors now increasingly hope for an end to the raging war soon. US President Donald Trump said the country could end its military attacks on Iran within two to three weeks and Tehran did not have to make a deal as a prerequisite for the conflict to ease. "We'll be leaving very soon," Trump told reporters at the White House on Tuesday.

Iranian President Masoud Pezeshkian meanwhile said that the country had the "necessary will" to end the ongoing war with Israel and the United States, but was seeking guarantees that the conflict would not be repeated.

"We possess the necessary will to end this conflict, provided that essential conditions are met, especially the guarantees required to prevent repetition of the aggression," Pezeshkian said in a phone conversation with the president of the European Council, according to a statement from his office, reiterating a key demand of Tehran's.

The fall in oil prices today has cheered investors for these OMC stocks. HPCL shares surged more than 4% to trade at Rs 350 apiece, while BPCL shares nearly gained 4% to Rs 292 apiece. IOC shares, meanwhile, rose more than 3% to trade at Rs 140 apiece on Wednesday.

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