Crude Oil at $83/bbl – Who Gains and Who Loses

Crude Oil at $83/bbl – Who Gains and Who Loses

by 5paisa Research Team Last Updated: Dec 13, 2022 - 03:36 pm 50.5k Views
Listen icon

The price of Brent crude has rallied to above $83/bbl and is now at the highest level that oil has since in last 2014. In short, oil is at the highest level in the last 7 years. What is it that has contributed to this sharp rally in oil prices? It is a mix of demand surge and supply constraints that is pushing oil prices higher.

On the demand side, there has been a surge in oil demand in line with the opening up of economies post pandemic and also as industrial capacities get back to normal. On the supply side, OPEC has confirmed in its latest meet that the cartel would only be raising the supply gradually. US supplies are also constrained by the hurricane in Gulf of Mexico.

The sustained drawdowns in the US inventory in the last few weeks indicate that demand continues to far exceed supply. At a macro level, that has negative repercussions for the Indian trade deficit and the value of the rupee. More importantly, higher crude prices means higher inflation since India relies on imports for 80% of its daily crude needs.

Who gains and who loses from the oil prices spike?

The table below captures some of the key gainers from the spike in oil prices:


Gainer / Loser


ONGC Ltd and Oil India


Higher crude prices improves their realization per barrel and boosts profits. Has a positive impact on gas prices also



IOCL gains from better gross refining margins (GRM) and higher inventory translation gains on higher crude prices



A major beneficiary of higher gas prices since the price of gas is indirectly pegged to crude prices

The table below captures some of the Key Losers from the spike in oil prices:


Gainer / Loser


Asian Paints and Berger


Paint companies passed on most of their cost spikes to end users but that may not be possible beyond a point. Crude is a key input.

MGL, IGL, Gujarat Gas


City gas distributors or CGD players will be up against higher input costs that are likely to squeeze margins

Fertilizer Plants


The gas fired fertilizer plants are likely to see a negative impact of the oil price hike as higher gas prices will be a negative

Higher crude eventually impact all industries as the cost of petrol and diesel have strong externalities.

Also Read: 

Sectors dependent on crude Oil

What is Driving the Rally in Oil Stocks in India?

Crude Oil at $75/bbl – Here comes inflation

How do you rate this blog?

Start Investing in 5 mins*

Rs. 20 Flat Per Order | 0% Brokerage


About the Author

Our research team is composed of some highly qualified research professionals, their expertise range across sectors.

Open Free Demat Account
Resend OTP
Please Enter OTP
Mobile No. belongs to

By proceeding, you agree to the T&C.

Latest Blogs
Patanjali's false claims lands it in a trouble with Supreme Court

In the grand saga of health and wellness in India, enter Baba Ramdev, the face behind the wellness empire Patanjali. His online videos claim to offer cures that, according to him, modern science hasn't quite figured out. You might have stumbled upon those videos where he confidently asserts, "jad se bimari ko khatam kardene vala ilaj" (a remedy that eliminates diseases from their root)

Stock in Action- V-Guard Industries Ltd

V-Guard Industries Ltd Stock Movement of the Day

Market Outlook for 29 February 2024

Nifty started the ahead of the expiry on a flat note, but it witnessed correction throughout the day. The intraday pullbacks witnessed selling pressure and the index breached the 22000 mark and ended well below it with a loss of over a percent.