Oil India, ONGC, IOC, HPCL: Crude-sensitive stocks in focus as oil prices jump to 6-month high; what you need to know

This is because oil prices rose by around 2% on Thursday, reaching their highest levels in six months, as escalating tensions between the United States and Iran heightened concerns over potential supply disruptions in the oil-rich Middle East.

Brent crude futures rose $1.23, or 1.8%, to $71.58 a barrel at 1551 GMT, while U.S. West Texas Intermediate (WTI) crude gained $1.34, or 2.1%, to $66.53, according to Reuters.

Following a surge of more than 4% on Wednesday, Brent is on track for its highest close since July 31, and WTI is headed for its strongest settlement since August 1.

Market participants cited mounting geopolitical risks as the key driver. “Oil prices are being supported by geopolitical tensions and concerns that the U.S. could strike Iran in the near future,” said Andrew Lipow, president of Lipow Oil Associates. “The market is likely to continue rallying in anticipation of further developments.”

Adding to supply concerns, Iran planned joint naval exercises with Russia on Thursday, according to Iran’s semi-official Fars news agency. This follows recent military drills that temporarily shut down the Strait of Hormuz — a critical trade artery through which roughly 20% of global oil supply passes.

How oil & gas stocks fared on Thursday

The NIFTY Oil & Gas index ended over 1% lower at 12,036.15 levels, with 13 out of 15 components ending in the red. Oil India and ONGC were the gainers on the index, as both the companies are upstream producers — higher oil prices directly boost their revenue, margins, and profitability.

On the other hand, downstream players such as IOC, BPCL, and HPCL are sensitive to price volatility. Sharp rises in crude prices increase input costs and can compress refining and marketing margins, especially if fuel price hikes are not passed on immediately due to government intervention.