BPCL, HPCL To IOC: OMC Stocks Decline As Crude Surge Pressures Margins

Shares of state-run oil marketing companies, Bharat Petroleum Corporation, Hindustan Petroleum Corporation, and Indian Oil Corporation, fell by up to 3% on February 19. The decline came as global crude oil prices rebounded sharply, weakening investor sentiment and raising concerns about pressure on the companies’ profitability.

BPCL dropped around 3% to about ₹370.80 per share, HPCL slipped nearly 2.75% to ₹444.40, and IOC declined close to 2% to ₹175.24.

Geopolitical Tensions Push Crude Oil Higher

Crude oil prices surged in the previous trading session due to rising geopolitical tensions and fears of supply disruption.
Markets reacted to uncertainty surrounding global conflicts and stalled diplomatic discussions, which increased the risk of tighter oil supply.

Higher crude prices typically create challenges for oil-importing nations and companies that depend heavily on crude as a raw material.

Why Rising Oil Prices Hurt OMC Earnings

An increase in crude oil prices directly raises refining and fuel production costs for oil marketing companies.
If petrol and diesel prices are not increased in line with crude costs, marketing margins shrink, and profitability may decline.

Higher crude prices can also:

• Increase working capital requirements
• Raise the country’s import bill
• Create risk of inventory losses if fuel prices do not keep pace

All these factors can negatively impact cash flows and overall financial performance of OMCs.

Also Read: Best PSU Stocks in India in February 2026!

Conclusion

The recent fall in OMC stocks reflects investor concern over rising crude oil prices and their impact on margins and earnings.
Future stock movement will largely depend on crude price trends, geopolitical developments, and any revision in domestic fuel prices.

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