As Oil Prices Decline, OMCs, Aviation and Paint Stocks Rally; ONGC and Oil India Under Pressure

Mumbai, June 24, 2025: After the US president declared a ceasefire in the Iran-Israel conflict, crude oil prices declined by almost 2%, resulting in a rally of OMCs (Oil Marketing Companies), aviation, and paint company shares. Nifty Oil and Gas started the day in green and was up by 0.20% at 12:45 PM (up by 0.20%).

OMCs Lead the Gains

Bharat Petroleum Corporation Ltd (BPCL), Hindustan Petroleum Corporation Ltd (HPCL), and Indian Oil Corporation (IOC) saw strong buying interest. At 12:45 PM on Tuesday, major oil companies’ shares were trading higher than the previous closing price:

• BPCL rose 1.88%
• HPCL jumped 2.92%
• IOC gained 2.37%

The sharp fall in crude prices has improved the earnings outlook for these companies, which rely on lower input costs to maintain healthy margins.

Aviation and Paint Stocks Climb

Aviation stocks followed suit, with InterGlobe Aviation (IndiGo) rising 3.34% to ₹5,649.50. Lower crude prices reduce aviation turbine fuel (ATF) costs, boosting airline profitability.

Paint companies also witnessed gains, with Asian Paints up 0.89% to ₹2,284.20. The decline in crude-derived raw material costs like solvents and resins supports improved operating margins in the paint sector.

Tyre Stocks in the Green

Tyre manufacturers also benefited from the drop in oil prices, which helped reduce synthetic rubber and other petrochemical-based input costs. At 12:45 PM, MRF was up by 0.84% (₹1,36,695.00 per share) and CEAT rose by 1.88% (₹3,567.20 per share)

ONGC and Oil India Under Pressure

In contrast, upstream oil companies suffered losses due to weaker crude prices:

• ONGC fell by over 2.59%
• Oil India dropped 4.63% to ₹450.00 on the NSE

These firms typically benefit from higher oil prices; a sustained downtrend could weigh on their earnings.

Global Oil Prices Slide Amid Ceasefire

Brent crude futures tumbled $2.69 (3.76%) to $68.79 per barrel, while US West Texas Intermediate (WTI) crude fell $2.70 (3.94%) to $65.46. This marked their lowest levels since June 11 and June 9, respectively, after both benchmarks saw intraday drops of over 4% and 6%.

According to Bloomberg data, August WTI crude traded at $66.99, down 2.22%, and Brent futures were at $69.92, down 2.18%, as of 08:13 AM (ist).

Geopolitical Easing Brings Relief

US President Donald Trump announced that Israel and Iran have agreed to a complete and total ceasefire, with Iran initiating the truce immediately and Israel following within 12 hours. If both sides maintain peace, the 12-day conflict will formally conclude within 24 hours.

Iran, the third-largest producer in the OPEC bloc, could ramp up exports, easing global supply concerns that had previously driven oil prices higher.

This development has provided a broad-based boost to oil-dependent sectors, while exposing upstream producers to fresh downside risks amid geopolitical de-escalation.

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