BPCL Falls After Flat Report Card Before Cheering Up on Russian Oil Remarks

Mumbai, May 20: Shares of Bharat Petroleum Corporation Limited rose on Wednesday after the company said it was reviewing crude import plans on a near-daily basis and increasing spot purchases, including Russian oil, amid disruptions caused by the Iran conflict.

BPCL gained over one per cent at Rs 290after Chairman Sanjay Khanna, quoted by Reuters news agency, said the state-run refiner continues to buy Russian crude and has significantly increased spot market purchases to maintain refinery operations as supply disruptions from the Middle East intensify.

To be sure, shares had fallen in early trade after net profit came in nearly flat due to a one-time impairment charge related to an investment in a subsidiary.

Russian Oil Remains Key

BPCL said it currently sources nearly 40-45% of its crude requirements from Russian oil, largely through spot purchases, after disruptions to Middle Eastern supplies following the closure of the Strait of Hormuz.

Stock fell on a flat report card before cheering up on Russian oil remarks. Source: NSE 

The company had initially planned to procure around 55% of its crude needs for FY27 through annual contracts, mainly from Middle Eastern suppliers, with the rest through spot markets. However, the geopolitical crisis has forced refiners to alter sourcing strategies rapidly.

Khanna said BPCL is recalibrating its import plans “almost daily” as the situation evolves. The company is operating its refineries at around 115% capacity to meet domestic fuel demand.

Discounts Narrow

Investor sentiment was also supported by the company’s ability to continue accessing Russian crude despite tighter global supplies.

However, BPCL noted that discounts on Russian oil have narrowed sharply. Finance Director Vetsa Ramakrishna Gupta said Russian crude discounts have fallen to $5-$6 per barrel to dated Brent on a delivered basis, compared with $10-$12 earlier.

The company added that it is evaluating annual supply agreements with newer producers if they offer flexible delivery schedules and competitive pricing, although BPCL still prefers sourcing from nearby regions over distant suppliers such as Venezuela or Canada.

Fuel Losses Remain a Concern

Despite recent fuel price hikes, BPCL said it continues to incur losses on retail fuel sales due to elevated crude prices.

The company is currently facing revenue losses of ₹25-30 per litre on diesel and ₹10-14 per litre on petrol, highlighting the pressure on oil marketing companies amid surging global energy prices.

India, the world’s third-largest oil importer and consumer, has been grappling with rising crude prices and supply disruptions since the escalation of tensions involving Iran. The crisis has also intensified concerns around inflation, fuel prices and energy security.

The comments came after BPCL reported a 42.6% rise in adjusted fourth-quarter profit, helped by steady fuel demand.

Source:

• https://www.nseindia.com/get-quote/equity/BPCL/Bharat-Petroleum-Corporation-Limited