ONGC shares led the gains, climbing 3.5% to Rs 289 on BSE. On the flip side, Reliance Industries and Oil India traded marginally in the red amid a weak broader market mood.
The main U.S. oil benchmark surged more than 30% on Monday amid fears the Middle East war could trigger prolonged supply disruptions. At 0230 GMT, West Texas Intermediate (WTI) jumped 30.04% to $118.21 per barrel before easing slightly, while Brent crude was up 27.54% at $118.22.
A rise in crude prices is a positive development for upstream oil and gas companies such as ONGC and Oil India. Higher prices directly increase their revenue per barrel, potentially lifting profit margins and encouraging higher capital expenditure on exploration.
Will prices hit $150?
Qatar’s energy minister told the Financial Times he expects all Gulf energy producers to shut down exports within weeks, a move he said could drive oil to $150 a barrel, according to an interview published on Friday.
Domestic brokerage JM Financial said that every $1 increase in crude prices raises India’s annual import bill by roughly $2 billion. Prolonged tensions could elevate logistics and marine insurance costs, disrupt Gulf shipping routes, and widen pressure on the trade balance.
The rupee faces a near-term depreciation bias, with potential intervention by the Reserve Bank of India via foreign exchange reserves. The transmission mechanism is evident: higher crude prices increase inflation risks; elevated inflation pushes bond yields higher; and rising yields compress equity valuation multiples.The combination of commodity cycle rotation, an elevated gold-crude oil ratio, and rising geopolitical risks suggests crude oil may be entering a stronger phase of the broader commodity cycle.
“With gold near $5,100 and the ratio around 62, crude is implied at roughly $82 per barrel. If the ratio compresses toward 55–45, crude oil prices would mathematically move toward the $95–$115 per barrel range, assuming gold remains broadly stable near current levels,” said Apurva Sheth, Head of Market Perspectives and Research at SAMCO Securities.
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