STOCKS OF OMC's RISE SHARPLY ON ACCOUNT OF FALL IN CRUDE OIL PRICES
Stock prices of oil marketing companies (OMC) in India like IOC , BPCL , HINDPETRO have gone up by 5% today due to the fall in crude oil prices on account of cooling tensions in the Middle East region. In the last few weeks, shares of oil marketing companies came under selling pressure as crude oil prices increased.
When crude oil prices rise, shares of these companies come under pressure as their input costs increase but they are not be able to pass on the price hike to consumers due to pricing regulations thereby impacting their profit margins. However, as crude oil prices come down, these companies will be able to buy cheaper crude oil and thereby be able to generate good profits in the near future.
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