IOC, BPCL to HPCL: Oil PSU stocks gain up to 2.5% as crude oil rally loses steam ahead of US-Iran talks this weekend

Shares of oil marketing companies (OMC) rose up to 2.5% in the early morning session on Friday, April 10, as crude oil prices trimmed gains ahead of the US-Iran ceasefire talks scheduled to take place in Pakistan this weekend.

A possible breakthrough in the Middle East war and hopes of reopening the Strait of Hormuz, which accounts for nearly 20% of global oil passage, have pulled crude oil prices below their recent highs hit at the height of the crisis.

Oil prices had risen by over 50% last month and weighed heavily on the PSU oil stocks as crude forms a major input cost for these companies. OMCs tend to bear the brunt of the crude spike, as retail price adjustments often lag behind the rapid surge in international prices.

This week, both contracts — Brent and WTI — have lost 11% so far, the biggest weekly decline since June 2025, according to a Reuters report. At the time of writing, Brent crude prices had pulled back from the earlier rise of 0.8% and were up 0.2% around $96/bbl as fresh anxiety over supplies from Saudi Arabia capped downside.

Against this backdrop, shares of Indian Oil Corporation (IOC), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation (HPCL) rose 2%-2.5% today. Meanwhile, a positive sentiment in the Indian stock market also boosted gains.

Last month, oil PSU stocks had tumbled between 25% and 27% as concerns over elevated crude prices, along with minimal expected RSP/excise duty intervention, worried investors about the near- to medium-term impact on margins.

In the current environment of negative marketing margins, all three OMCs face significant earnings risk. HPCL is currently the most vulnerable, with a combined refining cover of <50%, leaving it far more exposed to marketing under-recoveries compared to BPCL (~70%) and IOCL (~75%), Ambit Capital had said in a report dated March 23, 2026.

US-Iran talks eyed

In Pakistan, authorities were preparing for the first round of US-Iran talks on Saturday aimed at settling the Middle East conflict that began with US and Israeli attacks on Iran on February 28.

Iran released on Wednesday a 10-point proposal for a settlement to the war that included maintaining control of the Strait of Hormuz, acceptance of Iran's right to nuclear enrichment, lifting of sanctions and ending the war, including against Hezbollah in Lebanon, as per a Reuters report.

Meanwhile, US President Donald Trump said in a social media post late Thursday that Iran was doing a "very poor job" of allowing oil to go through the strait. "That is not the agreement we have!"

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