Oil & Gas Stocks Rally as Falling Crude Prices Improve Margin Outlook

Shares of key oil marketing companies (OMCs) and oil & gas firms surged on Tuesday, lifting the Nifty Oil & Gas index by nearly 1.7% in morning trade. The rally was fueled by a decline in global crude oil prices, sparking optimism among investors over improved gross marketing margins for Indian refiners. Leading the gains were Hindustan Petroleum Corporation (HPCL) and Bharat Petroleum Corporation (BPCL), which climbed nearly 4% each, trading at ₹421 and ₹332 respectively. Indian Oil Corporation (IOC) advanced 2.5% to ₹146, while ONGC emerged as the top Nifty gainer, up 2%. Reliance Industries, India’s largest listed company, rose 1.6% to ₹1,461—an eight-month high—and topped the Sensex gainers list. Oil India also posted a strong 3% gain to ₹449. Global oil prices declined slightly on June 11 as traders digested the implications of ongoing US-China trade talks held in London, awaiting commentary from President Donald Trump. Concerns over weak Chinese demand and lower output from OPEC+ continued to weigh on sentiment. As of early trading, Brent crude was down 0.3% at $66.68 per barrel, while West Texas Intermediate (WTI) also slipped 0.3% to $64.82, according to Reuters. Meanwhile, the OPEC+ coalition’s decision to gradually ramp up production was viewed positively by Indian refiners, as it may help sustain lower input costs and enhance fuel marketing margins. Adding further momentum, Avendus Spark initiated coverage on Oil India with a ‘Buy’ rating and a target price of ₹630, signaling a potential 44% upside from its last close of ₹437. The sector has benefited from oil prices remaining under $70 since April, offering a cushion to Indian downstream firms grappling with global price volatility and cost pressures.