BPCL, IOC, HPCL Shares Tumble As India Raises Petrol & Diesel Prices For First Time In 4 Years

Shares of oil marketing companies (OMCs), including Bharat Petroleum Corporation Ltd (BPCL), Indian Oil Corporation Ltd (IOC), and Hindustan Petroleum Corporation Ltd (HPCL), came under sharp selling pressure on Friday morning after the government announced a Rs 3 per litre hike in petrol and diesel prices.

The steps taken by the government to reduce mounting under-recoveries, which is currently being faced by state-run fuel retailers, triggered a negative reaction in the stock market.

This is the first time in four years that the government has implemented a petrol price and diesel price hike due to soaring global crude oil prices and escalating tensions in West Asia, which are causing a lot of pressure on oil marketing companies.

BPCL, IOC, HPCL shares fall on NSE

All three oil marketing company stocks opened lower on the NSE in early trade on Friday.

At the time of writing, Hindustan Petroleum Corporation Ltd (HPCL) shares slipped over 2% to Rs 368.75 per shares. Indian Oil Corporation Ltd (IOC) stock fell to Rs 139.06, while Bharat Petroleum Corporation Ltd (BPCL) shares declined to Rs 291 per share on the NSE.

Nifty Oil & Gas Index was also traded under pressure, down by 0.97% at 11331.

Petrol and diesel prices hiked after four years

India has increased retail petrol and diesel prices by approximately Rs 3 per litre each from May 15TH. The revision was announced by state-run oil companies under the current fuel pricing mechanism. The petrol price in Delhi has risen to Rs 97.77 per litre from Rs 94.77 earlier. Diesel prices in the national capital now stand at Rs 90.67 per litre.

Petrol Price Today In Major Cities

City	New Petrol Price(per Litre)	Increase
New Delhi	Rs 97.77	Rs 3.00
Kolkata	Rs 108.74	Rs 3.29
Mumbai	Rs 106.64	Rs 3.10
Chennai	Rs 103.90	Rs 3.10
Bangalore	Rs 106.17	Rs 3.21
Hyderabad	Rs 110.89	Rs 3.39
Jaipur	Rs 108.19	Rs 3.16
Patna	Rs 108.55	Rs 3.01

Diesel Price Today In Major Cities

City	Diesel Price (Rs/litre)	Price Change
New Delhi	90.67	3
Kolkata	95.13	3.11
Mumbai	93.14	3.11
Chennai	95.25	2.86
Bangalore	94.1	3.11
Bhubaneswar	95.74	3.19
Hyderabad	98.96	3.26
Jaipur	93.23	2.74
Patna	94.63	2.85
Thiruvananthapuram	99.35	3.09

Why were petrol and diesel prices increased?

The latest petrol diesel price hike comes amid a sharp rally in global crude oil prices. Brent crude surged above $107 per barrel, while WTI crude traded around $103 per barrel.

Concerns over supply disruptions due to the ongoing West Asia conflict have intensified fears in the global oil market. Markets remained volatile even after former US President Donald Trump reportedly said he "doesn't need Hormuz open," a comment that failed to calm investor concerns.
The spike in crude prices significantly increased pressure on Indian oil marketing companies, which were already witnessing massive under-recoveries.

Union Petroleum and Natural Gas Minister Hardeep Singh Puri recently warned that state-run oil companies are collectively losing around Rs 1,000 crore every day by continuing to sell petrol, diesel, and LPG below cost.

According to the minister, cumulative under-recoveries of oil marketing companies have reached nearly Rs 1.98 lakh crore.
Puri further cautioned that if crude oil prices remain elevated and retail fuel prices are not revised further, OMCs could suffer losses of around Rs 1 lakh crore in a single quarter.