Shares of oil and gas sector companies experienced significant gains on Tuesday, May 19, with the Nifty Oil & Gas index advancing 0.64 per cent following the hike in petrol and diesel prices. According to reports from Business Standard, at 09:28 AM, the index was up 0.45 per cent at 11,212.55 levels, led by Indraprastha Gas, which was trading over 2.10 per cent higher. Among other major gainers, Hindustan Petroleum Corporation (HPCL), Bharat Petroleum Corporation (BPCL), Indian Oil Corporation (IOCL), Adani Total Gas, and Chennai Petroleum Corporation were trading over 1 per cent higher each. The positive momentum continued throughout the trading session, with Premier Energies also contributing to the sector's gains.
Petrol and diesel prices were raised by around 90 paise per litre on Tuesday, marking the second fuel price hike in less than a week after state-run retailers ended a nearly four-year freeze on revisions. As reported by Business Standard, following the latest increase, petrol prices in New Delhi rose to ₹98.64 per litre from ₹97.77, while diesel prices climbed to ₹91.58 per litre from ₹90.67. The revision comes after state-owned fuel retailers increased petrol and diesel prices by ₹3 per litre on Friday — the first hike in more than four years, following a sharp surge in global crude oil prices amid escalating tensions involving Iran. However, brokerages expect oil marketing companies might need another ₹25 per litre hike in retail fuel prices to break even on fuel marketing margins, with integrated under-recoveries of oil marketing companies post the price hikes standing at around ₹13 per litre.
According to Business Standard, Reliance Industries, Aegis Logistics, Petronet LNG, and Castrol India were also trading higher by up to 0.88 per cent. However, some companies faced declines, with Mahanagar Gas, Aegis Vopak Terminals, Oil and Natural Gas Corporation (ONGC), and GAIL (India) trading lower, with losses extending up to 0.80 per cent. Following the ₹3 hike in petrol and diesel prices on May 16, the losses being incurred by oil marketing companies (OMCs) from liquefied petroleum gas (LPG), petrol and diesel combined have come down by ₹250 crore a day to ₹750 crore at present. The recent hike in petrol and diesel prices is likely to impact demand in the automobile sector, with analysts expecting double-digit demand growth seen in 2025-26 might come down to around 8-10% in rural areas, particularly for two-wheelers.
Global oil prices eased on Tuesday after US President Donald Trump said he was holding off on a planned military strike on Iran, citing the possibility of "serious negotiations" between the two sides. As reported by Business Standard, following Trump's statement, Brent crude declined nearly 2 per cent to around $109 per barrel, while West Texas Intermediate (WTI) crude fell 1.44 per cent to $102.88 per barrel. Meanwhile, the US Treasury said it would extend a sanctions waiver permitting purchases of Russian seaborne oil for another 30 days to support "energy-vulnerable" countries facing disruptions in Gulf oil supplies. The government also introduced windfall gains tax of ₹3 per litre on the export of petrol and reduced the special additional excise duty on diesel and aviation turbine fuel exports.
