Oil Marketing PSUs shares declined over 7 percent post retail oil prices cut
Oil marketing company (OMC) stock prices fell up to 8% on Friday after petrol and diesel prices were cut by Rs 2 per liter, the first time in almost two years.
Three major oil companies have experienced significant losses. HPCL, whose shares fell by nearly 8%, dropped to the day's low of Rs 461.10 on the NSE. BPCL followed with a 5.4% drop to the day's low of Rs 576. Meanwhile, IOCL plunged by 5% to hit its intraday low of Rs 16.
Meanwhile, some other leading stocks like Reliance Industries (RIL), Oil and Natural Gas Commission, and Castrol India also fell up to 2%. The retail price cut has impacted the oil marketing companies in a devasted manner resulting in losses of share prices.
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As per the brokerage analyst Motilal Oswal Financial Services, the expected negative stock price reaction for OMCs near term gives the chance of the retail price cut fueled by the recent elevated Brent crude prices of $85/bbl.
As the impact of the Red Sea crisis on crude oil and refining GRMs is somehow mitigated it is believed that marketing margins can again, even after the price cut recover above Rs 3 per liter. There is no relief expected from the government while OMCs are supposed to be solely responsible for the price cut.
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