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Informist, Friday, Jan. 17, 2025

MUMBAI – Shares of oil companies are likely to see muted gains next week, analysts said Friday. The movement in crude oil prices, changes in US policies under president-elect Donald Trump, and corporate earnings will determine the direction of the stock prices, they added.

After remaining stable for a week, the Brent crude oil futures rose significantly this week. At 1643 IST, Brent crude futures on the Intercontinental Exchange were up 0.43% at $81.64 per barrel. A rise in futures contracts indicates crude oil prices are expected to rise in the future.

Also, this week rupee hit a fresh all-time low of 86.64 per dollar. The rise in crude oil prices and depreciation of the rupee could hit profitability of oil marketing companies, whose key raw material is crude oil, which is mostly imported. On the other hand, upstream companies could see a boost as higher crude oil prices mean better realisations.

However, the US Energy Information Administration expects crude oil prices to decline from mid-2025 till the end of 2026 as growth in global oil production will outpace the growth in oil demand. The unwinding of the Organization of the Petroleum Exporting Countries and allies' production cuts and strong growth in oil production outside the cartel will be the key reasons for growth in global oil production, the agency had said in its Short-Term Energy Outlook report for January. "We forecast that the Brent Crude Oil price will average $74 per barrel in 2025, 8% less than in 2024, and then continue to fall another 11% to $66 per barrel in 2026," the agency said.

The International Energy Agency expects global crude oil demand to grow by 1.05 million barrels per day to 104 million barrels per day in 2025, slightly lower than the 1.1 million barrels per day projected last month. The agency expects global oil supply to rise by 1.8 million barrels per day this year to 104.7 million barrels, compared to the growth of 660,000 barrels per day seen in 2024. Hence, supply of crude oil is expected to outpace demand, further indicating a fall in crude oil prices in the near term.

On Monday, Donald Trump will be sworn in as president of the US, and any change in policy he announces could act as a trigger for movement of shares in the sector, analysts said.

On the earnings front, Bharat Petroleum Corp. and Hindustan Petroleum Corp. are scheduled to release their December quarter results this week. Both downstream companies are likely to post strong on-year rise in net profit on robust refining and marketing margins. BPCL's net profit is seen rising 45% on year to INR 49.29 billion, while revenue is expected to fall nearly 10% on year to INR 1.041 trillion, as per the average of estimates from 14 broking firms. For HPCL, the net profit is expected to rise sixfold on year to INR 32.22 billion and revenue is seen nearly 10% down at INR 1.003 trillion, as per the average of estimates from 13 brokerage houses.

On Friday, the Nifty Oil & Gas index closed 1.6% higher at 10891.70 points, with 12 out of 15 constituents in the green. Oil and Natural Gas Corp., Reliance Industries, and Oil India were the major stocks in the index that rose during the week. Downstream players such as HPCL, Indian Oil Corp., and BPCL were among the major laggards over the week.

TOP HEADLINES

* RIL to buy Lakadia B Power Transmission, Reliance New Energy Battery
* Recovery in retail, telecom rate hike offset oil, gas low income growth: RIL
* Earnings Review: RIL net profit up on yr after 3 qtrs of decline, beats view
* Reliance Jio PAT, revenue post moderate QoQ growth on tariff hikes
* GR Infraprojects acquires Bijapur REZ Transmission for INR 114 mln
* BPCL executes INR 318-bln loan pact with SBI consortium for Bina project
* Earnings Outlook: Supreme Ind Oct-Dec net seen down due to low infra spends
* Earnings Outlook: Low crude costs to drive BPCL Oct-Dec PAT up 45% on year
* IRFC signs pact with NTPC to finance railway wagons worth INR 2.5 bln
* Delhi HC rejects GST show-cause notices to electricity regulators
* GAIL settles arbitration with SEFE Marketing; Singapore co to pay $285 mln
* Hitachi Energy board to mull fundraising proposal on Sat
* IEA sees global crude oil demand rising 1.05 mln bbl to 104 mn bbl in 2025
* JSW Energy arm synchronises 350 MW capacity of thermal plant in Odisha
* EIA expects crude prices to fall from mid-2025 on rising global production
* Adani Green Apr-Dec energy sales 20.11 bln units, up 23% on year
* Earnings Outlook: RIL's Oct-Dec net profit to rise YoY after 3 qtrs of fall
* Equity Futures: Bulls bet on JSW Energy as co wins bid to buy KSK Mahanadi
* IRFC lowest bidder to finance INR-31.7-bln Jharkhand coal block project
* Adani Green arm commissions 57.2-MW wind power component for Khavda project
* IDBI Trusteeship Services releases GMR Airports' 386.80 mln pledged shares
* Catalyst Trusteeship releases GMR Airports' 270.40 mln pledged shares
* JSW Energy outbids Adani Power offer to acquire KSK Mahanadi Power Co
* Creditors approve JSW Energy's resolution plan for KSK Mahanadi Power Co
* Adani Energy Solutions Oct-Dec system availability unch QoQ at 99.7%
* US sanctions on Russia may affect oil prices marginally, say govt sources
* Diversified oil import sources, affordability key concern for govt: Oil secy
* HPCL commissions LNG regasification terminal at Chhara in Gujarat
* GR Infraprojects emerges lowest bidder for INR 19.47-bln project in Pune
* Indraprastha Gas appoints Sukhmal Kumar Jain as chairman effective Tuesday
* CARE upgrades rating on Inox Wind's long-term bank facilities to 'A+'
* MRPL launches new product Toluene; production capacity 40,000 tonnes per yr
* PLI, subsidies hurt long-term growth of clean energy sector: Minister Goyal
* HEG signs MoU with Ceylon Graphene, plans to set up graphene unit in India
* JSW Energy arm acquires 125 MW renewable energy assets from Hetero group
* Power Grid acquires Kundankulam ISTS for INR 74.4 mln from PFC Consulting
* Poly Medicure forms JV with AMPIN C&I to set up solar power unit in Haryana
* SPOTLIGHT: Oil cos seek more maize-based ethanol Aug-Oct; but supply unsure
* CESC Oct-Dec PAT rises 1.2% YoY to INR 1.72 billion, revenue up 6.5%

Following are the resistance and support levels for the stocks for next week as per calculations by Informist based on their prices on the National Stock Exchange:

End

US$1 = INR 86.61

Reported by Akshay V. Johnson

Edited by Subhojit Sarkar

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