Mumbai, October 27 (Monday): Shares of major Indian refiners and oil companies, including Indian Oil Corporation (IOCL), Bharat Petroleum Corporation (BPCL), Hindustan Petroleum Corporation (HPCL), Reliance Industries (RIL), Mangalore Refinery and Petrochemicals (MRPL), and Chennai Petroleum Corporation, were in focus today after a sharp rise in gross refining margins (GRMs) and the lifting of force majeure on the Mozambique LNG project.
GRM surge boosts refining outlook
In the past 10 days, GRMs have jumped from $0.41 per barrel to $8.6 per barrel, significantly improving the earnings outlook for refiners.
According to analysts, every $1/bbl rise in GRMs boosts profitability for these companies as follows:
| Company | Impact of $1/bbl rise in GRMs |
|---|---|
| Chennai Petroleum | +26% |
| MRPL | +24% |
| IOCL | +11% |
| BPCL | +10% |
| HPCL | +8% |
| RIL | +2% |
The steep increase in GRMs reflects strong product demand and favorable spreads in diesel and aviation turbine fuel (ATF), offering a near-term margin expansion opportunity for Indian refiners.
Mozambique LNG restart — a major positive
Adding to the positive sentiment, TotalEnergies and its consortium partners have officially lifted force majeure on the $20 billion Mozambique LNG project, signaling a restart of one of Africa’s largest energy ventures. The project had been halted since 2021 following security concerns in the Cabo Delgado province.
The decision follows improved regional security and renewed government cooperation, paving the way for construction to resume.
- BPCL holds a 10% stake,
- ONGC holds 16%, and
- Oil India holds 4% in the consortium.
This development is expected to strengthen upstream earnings visibility for these companies while also supporting India’s long-term LNG supply diversification strategy.
Market view
Analysts expect the twin tailwinds — higher refining margins and Mozambique LNG restart — to keep refining and energy stocks in focus through the week. BPCL and ONGC, in particular, are seen as near-term beneficiaries due to their exposure to both refining and upstream LNG segments.
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