Shares of Bharat Petroleum Corporation Ltd (BPCL) rallied sharply on Monday, May 25, with the stock rising Rs 10.50 or 3.55% to Rs 306.10 in early trade, after global crude oil prices witnessed a steep correction following optimism around a potential US-Iran agreement.
Crude oil prices fell sharply on Monday, with MCX crude futures declining 5.08% to Rs 8,702 per barrel in early trade. Brent crude dropped 4.8% to $98.52 per barrel, slipping below the $100 mark for the first time this month, while WTI crude futures fell 5% to $91.76.
The sharp decline in oil prices came after US President Donald Trump stated over the weekend that a deal with Iran had been “largely negotiated” and details would be announced soon. Reports suggested that the agreement could include reopening the Strait of Hormuz, the key global energy shipping route through which nearly one-fifth of worldwide oil and LNG supplies normally pass.
Lower crude prices are generally considered positive for oil marketing companies such as BPCL, IOC, and HPCL as they help improve marketing margins, reduce raw material pressure, and lower concerns around inventory losses and under-recoveries.
The move also comes after India raised petrol prices for the fourth time in 12 days earlier on Monday, pushing Delhi petrol prices above Rs 102 per litre. Analysts believe sustained softness in crude prices could ease pressure on domestic fuel pricing and support profitability for state-run fuel retailers.
At around 9:20 AM, BPCL shares were trading at Rs 306.10 after touching an intraday high of Rs 307.60. The company’s market capitalization stood at approximately Rs 1.32 lakh crore.
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