Oil India, ONGC: Here is how oil & gas stocks are performing amid sharp spike in crude oil prices

In the morning trade, the NIFTY Oil & Gas index was trading 0.20% higher at 11,624.75 levels. The top gainer was ONGC (up 1.08%). Next on the ganiers' list were Petronet LNG and Gujarat Gas. Oil India was trading 0.43% higher at ₹419.20.

In the international market, the crude oil benchmarks WTI crude and Brent jumped more than 5% on Thursday and were set for about a 7% weekly gain, the biggest since mid-June, as fresh US sanctions on Russia's two biggest oil companies over the war in Ukraine fuelled supply concerns.

US President Donald Trump's administration announced on Wednesday new "massive sanctions" against Russia's oil industry that are aimed at “moving Russian President Vladimir Putin to the negotiating table and bringing an end to Moscow's brutal war in Ukraine.”

"The sanctions against oil giants Rosneft and Lukoil followed months of calls from Ukrainian President Volodymyr Zelenskyy as well as bipartisan pressure on Trump to hit Russia with harder sanctions on its oil industry, the economic engine that has allowed Russia to continue to execute the grinding conflict even as it finds itself largely internationally isolated," said a report by AP.

On Friday, in the early trade, US crude futures eased a bit but remained on track for a weekly gain.

The US sanctions prompted Chinese state oil majors to suspend Russian oil purchases in the short term, trade sources told Reuters. Refiners in India, the largest buyer of seaborne Russian oil, are set to sharply cut their crude imports, Reuters reported, quoting industry sources.

"Buying driven by supply tightness concerns over US sanctions on Russia has subsided," said Satoru Yoshida, a commodity analyst with Rakuten Securities.

"With OPEC holding spare capacity, a one-sided rally is unlikely," he said, predicting that WTI is expected to trade within about $5 above or below $65.

Kuwait's oil minister said that the Organization of the Petroleum Exporting Countries would be ready to offset any shortage in the market by rolling back output cuts.

Russia was the world's second-biggest crude oil producer in 2024 after the US, according to US energy data.