SpiceJet Shares Up Over 5%, BPCL Soars 3% As Oil-sensitive Stocks Surge After Crude Oil Prices Decline Below $90

Mumbai, June 12: Shares of oil-sensitive companies surged on Friday after global crude oil prices extended their decline, boosting sentiment across sectors that benefit from lower energy costs. The rally came after Brent crude slipped below the key $90-per-barrel mark following signs of easing geopolitical tensions in the Middle East, raising hopes of lower input costs and improved profitability for several industries. 

Spicejet share price rose over 5% while InterGlobe Aviation, the parent of IndiGo, rose over 3%. Oil marketing companies (OMCs) also outperformed, with Hindustan Petroleum Corporation Ltd (HPCL) share price gaining 2.3%. Bharat Petroleum Corporation Ltd (BPCL) share price rose 3% and Indian Oil Corporation (IOC) share price also traded firmly higher, up 2.2%, as falling crude prices improved the outlook for refining and fuel marketing margins. Lower crude prices typically reduce working capital requirements and ease pressure on fuel retailers, which have grappled with volatile energy markets in recent months. 

Aviation Stocks Benefit from Lower Fuel Costs 

Struggling carrier Spicejet took flight as crude crash bumped up the carrier’s hopes and aspirations. Source: Google  

Airline stocks were among the biggest beneficiaries of the decline in oil prices, as aviation turbine fuel (ATF) remains one of the largest components of operating expenses. 

Spicejet led the gains within the aviation space as investors factored in the possibility of lower fuel bills if crude prices remain subdued. The stock has been particularly sensitive to movements in crude oil this year, with investors viewing lower energy costs as a key driver of margin expansion for carriers. 

Tyre, Paint Stocks Advance 

BPCL led gains among oil marketers as Brent below $90 inspired investors and outlook both. Source: NSE 

Tyre manufacturers also witnessed buying interest as crude-linked raw materials account for a significant portion of production costs. Shares of leading tyre makers Apollo Tyres, JK Tyre and CEAT gaining up to 3% on expectations that softer crude prices could help ease input cost pressures and support profitability. 

Paint companies too attracted investor interest, with Asian Paints and Berger Paints rising around 1% each as many of their key raw materials are petroleum derivatives. Lower crude prices are generally viewed as positive for the sector because they improve gross margins and reduce pressure on pricing. Similar rallies in paint and tyre stocks have accompanied previous declines in oil prices this year. 

Crude Retreat Sparks Sector Rotation 

The rally follows a sharp reversal in crude oil markets after U.S. President Donald Trump cancelled planned strikes on Iran, easing fears of supply disruptions in the Gulf region. Brent crude fell below $90 a barrel, while U.S. crude slipped toward $86, prompting investors to rotate into sectors that directly benefit from lower fuel and raw material costs. 

Market participants will continue to monitor developments in the Middle East, as any renewed escalation could reverse the recent decline in oil prices. For now, however, the sharp correction in crude has provided a strong tailwind for airlines, OMCs, tyre makers and paint companies, making them some of the top-performing pockets of the market. 

Source: 

• https://www.nseindia.com/get-quote/equity/HINDPETRO/Hindustan-Petroleum-Corporation-Limited
• https://www.nseindia.com/get-quote/equity/INDIGO/InterGlobe-Aviation-Limited
• https://www.nseindia.com/get-quote/equity/BPCL/Bharat-Petroleum-Corporation-Limited
• https://www.nseindia.com/get-quote/equity/IOC/Indian-Oil-Corporation-Limited