Crude below $80/barrel to support OMCs in near-term; ONGC, Oil India key beneficiaries of high prices
₹7.9per litre compared to the historical margin of ₹3.5/litre and gross auto-fuel integrated margin has risen to ₹16.8/litre compared to the historical margin of ₹11.3/litre. ‘’Optimism on OMCs will be contingent on crude sustaining below ~$80/bbl with OMCs’ FY24 P/B valuations (at ~0.9x for HPCL/IOCL and 1.1x for BPCL) being only 10 per cent discount to historical average after recent rally,'' said JM Financials.
The Organization of the Petroleum Exporting Countries and its allies (OPEC+) will meet for its next oil output policy decision on November 26, to consider whether to make additional oil supply cuts. Saudi Arabia and Russia have extended their combined oil output cut of 1.3 million barrels per day (bpd) till the end of the year, which the oil majors first announced in July 2023, in a bid to support the stability of the oil market.
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