US-Iran war: BPCL, GAIL to HPCL — oil and gas stocks rise despite soaring crude oil prices
With the US-Iran war disrupting global energy supplies and keeping crude oil prices elevated and volatile, oil and gas companies are expected to report a mixed performance for the first quarter of FY27.
Oil and gas stocks rallied on Thursday despite a sharp rise in global crude oil prices. The gains pushed the Nifty Oil & Gas index up nearly 1%.
Mahanagar Gas shares emerged as the top performer on the Nifty Oil & Gas index, rallying nearly 3%. It was followed by Petronet LNG, Reliance Industries, Indraprastha Gas, GAIL (India), Adani Total Gas, Hindustan Petroleum Corporation (HPCL), and Bharat Petroleum Corporation (BPCL), with each stock gaining more than 1%.
The rally in oil and gas shares came even as crude oil prices climbed sharply in the international market after fresh US strikes on Iran dampened hopes of a full reopening of the Strait of Hormuz — a critical maritime route through which around one-fifth of global oil supplies passed before the conflict.
Brent crude futures rose 1.15% to $78.92 a barrel, while US West Texas Intermediate (WTI) crude futures gained 1.22% to $74.42 a barrel.
With the US-Iran war disrupting global energy supplies and keeping crude oil prices elevated and volatile, oil and gas companies are expected to report a mixed performance for the first quarter of FY27.
Oil & Gas Q1 Results
Oil Marketing Companies (OMCs) are likely to post inventory and marketing losses due to higher crude prices during April and May, weighing on their Q1 results. In contrast, upstream companies are expected to benefit from stronger realizations amid higher crude oil and natural gas prices, supporting robust year-on-year EBITDA growth during the quarter, analysts said.
Kotak Institutional Equities expects consolidated EBITDA of Reliance Industries to rise 8.4% YoY and 5.4% QoQ, driven by O2C business. The brokerage firm expects a good result for GAIL India, while it sees higher spot volumes to offset the Strait of Hormuz disruption for Petronet LNG.
With the full impact of price hikes not reflecting in Q1, it expects weak results for Indraprastha Gas and Mahanagar Gas.