Oil Stocks Outlook
Seen dn; crude oil prices may fall on likely output hike
This story was originally published at 22:32 IST on 30 May 2025
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MUMBAI – Shares of oil and gas companies are likely to face some headwinds and see some selling pressure next week as well. The stocks are seen lower after ending the past two weeks in the red. The bias for the sector is expected to be negative for the entire week.
The final quarter of the financial year 2024-25 (Apr-Mar) was a fair one for oil and gas stocks. According to Nuvama Wealth Management's report Tuesday, the earnings before interest, taxes, depreciation, and amortisation of oil and gas companies for the March quarter grew 6% on year and 8% sequentially. Weakness in earnings of city gas distributors and gas transmission firms was offset by gains in Reliance Industries, Petronet LNG, oil marketing companies, and Oil and Natural Gas Corp., it said.
Going forward, a fall in crude oil prices is expected to provide some near-term margin relief to city gas distributors. But analysts are wary of electric vehicle policies in Maharashtra and New Delhi affecting the volume growth of these distributors. Analysts expect the gross refining margin of oil marketing companies to be under pressure in the near term. In their post-earnings conference calls with analysts, oil marketing companies expressed the hope of receiving compensation for liquefied petroleum gas under-recoveries.
The Organization of the Petroleum Exporting Countries and its allies are likely to discuss an increase in output for July at their meeting Saturday. This is expected to be larger than the increase of 411,000 barrels per day instituted for May and June. Crude oil inventories in the US, excluding those in the country's strategic petroleum reserves, fell by 2.8 million barrels to 440.4 million barrels in the week ended May 23, the US Energy Information Administration said in its weekly report. Analysts polled by Dow Jones had expected the stocks to fall by 600,000 barrels. This may have a negative impact on Indian oil stocks.
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* Govt OKs mkting rights to Chennai Petro for motor spirit, high speed diesel
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Following are the resistance and support levels for oil and gas stocks for next week as per calculations based on their prices on the National Stock Exchange:
| Company | Price | Week-on-week change in % | Resistance | Support |
| Bharat Petroleum Corp. | 318.40 | (-)0.20 | 324.70 | 313.90 |
| Hindustan Petroleum Corp. | 411.05 | 0.70 | 423.00 | 403.00 |
| Indian Oil Corp. | 141.97 | (-)1.50 | 145.70 | 139.30 |
| Oil & Natural Gas Corp. | 239.40 | (-)2.00 | 247.50 | 234.90 |
| Oil India | 426.80 | 0.20 | 455.40 | 410.00 |
| Reliance Industries | 1420.90 | (-)0.40 | 1441.30 | 1399.50 |
| Nifty Oil & Gas | 11388.40 | (-)0.70 | 11576.30 | 11266.60 |
| Nifty 50 | 24750.70 | (-)0.40 | 24923.90 | 24630.80 |
| S&P BSE Sensex | 81451.01 | (-)0.30 | 81890.30 | 81066.80 |
End
US$1 = INR 85.57
Reported by Anand JC and Simran Rede
Edited by Rajeev Pai
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