New Delhi: Shares of crude oil sensitive sectors — oil marketing companies, aviation, paints, adhesives and tyres — declined on Friday following a spike in global oil benchmark Brent crude prices amid escalating tensions in the
Middle East.
The stock of Bharat Petroleum Corporation Ltd (BPCL) fell by 1.90 per cent, Indian Oil Corporation (IOC) dropped 1.78 per cent and Hindustan Petroleum Corporation Ltd (HPCL) declined 1.41 per cent on the BSE.
In intra-day trade, BPCL tanked 6.11 per cent, Hindustan Petroleum Corporation Ltd tumbled 5.34 per cent and Indian Oil Corporation dropped 3.91 per cent.
Shares of InterGlobe Aviation edged lower by 3.71 per cent and those of SpiceJet dipped 1.95 per cent.
During the day, SpiceJet fell 5.64 per cent and InterGlobe Aviation dropped 5.62 per cent.
Global oil benchmark Brent crude jumped 8.39 per cent to $75.20 a barrel.
“Geopolitical tensions are heating up, and it’s impacting the oil market! Israel’s airstrikes on Iran have sparked fears of supply disruptions, causing crude oil prices to surge. The worry is that the situation could escalate into a full-blown regional crisis, which would have significant implications for global oil supplies,” Navneet Damani, Group Senior VP, Head Commodities Research, Motilal Oswal Financial Services Ltd, said.
Among paints stocks, Indigo Paints went lower by 2.63 per cent, Berger Paints dipped 0.59 per cent and Asian Paints declined 0.14
per cent.
Shares of Ceat slipped 1.35 per cent and Apollo Tyres edged lower by 1.13 per cent.
“In the near-term the market will be in a risk-off mode. Sectors that use oil derivatives as inputs like aviation, paints, adhesives and tyres will be hit hard. Oil producers like ONGC and Oil India will remain resilient,” VK Vijayakumar, Chief Investment Strategist, Geojit Investments
Limited, said.
Equity benchmark indices Sensex and Nifty tumbled nearly 1 per cent on Friday as weak global markets and a spike in Brent crude oil prices after Israel attacked Iran’s capital weighed on investor sentiment.
“Crude oil futures surged over 10 per cent to $76 per barrel, the highest in two months, as escalating tensions between Israel and Iran sparked fears of severe supply disruptions,” Rahul Kalantri, VP Commodities, Mehta Equities Limited, said.