Shares of Oil and Natural Gas Corporation and Oil India moved higher during intra-day trade, supported by firmer crude prices and expectations of steadier operational performance. Oil India rose as much as 4% to ₹470, while ONGC gained around 3% to trade near ₹272. The broader market remained under pressure, with benchmark indices trading lower during the session.

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Crude prices stayed above the $70 per barrel mark amid elevated geopolitical tensions in key oil-producing regions. The persistence of geopolitical risk has continued to support near-term crude prices, which tends to be favourable for upstream producers that benefit directly from higher realisations.

In addition, upstream companies are seen to be supported by stable production volumes and relatively stronger gas price realisations. The contribution from refining and downstream subsidiaries is also expected to cushion consolidated earnings, even as crude price volatility persists.

Oil Marketing Companies Under Pressure

In contrast, shares of oil marketing companies declined during the session. Bharat Petroleum Corporation, Hindustan Petroleum Corporation and Indian Oil Corporation were down up to 3% in intra-day trade.

OMC stocks came under pressure as markets assessed the sustainability of recent margin gains. While refining margins and fuel retail margins remained healthy in recent quarters, investors appear cautious about potential normalisation going forward, especially if crude prices remain volatile or if competition intensifies.

Crude Price Context

Crude oil prices continue to factor in a geopolitical risk premium, reflecting uncertainty around supply disruptions. However, global supply dynamics remain fluid, with increased output from non-OPEC producers and gradual unwinding of production cuts by oil-producing nations expected to influence prices over the medium term.

Any de-escalation in geopolitical tensions could ease crude prices, which would benefit downstream companies but may cap upside for upstream stocks. Conversely, sustained geopolitical risks could continue to support upstream earnings while keeping pressure on marketing margins.

Diverging Sector Trends

The session highlighted the contrasting dynamics within the oil and gas sector. Upstream companies drew support from crude-linked earnings visibility and gas production prospects, while oil marketing stocks reacted to margin-related concerns despite strong recent financial performance.