Comment on soaring crude oil prices by Saurabh Jain ,SMC Global Securities
Below the Comment on soaring crude oil prices by Saurabh Jain SMC Global Securities
Soaring crude prices are a clear negative for Indian OMCs in the near term. While petrol and diesel are officially deregulated, prices remain effectively controlled, limiting the ability to pass on higher input costs. This leads to under-recoveries and margin pressure, especially during sharp spikes like the current Hormuz-driven rally. Although OMCs are transitioning toward clean energy, their earnings are still largely driven by refining and fuel marketing. As a result, crude volatility continues to directly impact profitability. Unless supported by price hikes or government compensation, sustained high crude could strain balance sheets and delay energy transition investments.
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