Oil Stocks Outlook for the week – 06 to 10.03.2017
Oil Stocks Outlook for the week – 06 to 10.03.2017
( www.rupeedesk.in )
The shares of public sector oil refining and marketing companies--Indian Oil Corp Ltd, Bharat Petroleum Corp Ltd, and Hindustan Petroleum Corp Ltd--are likely to trade in a range next week. The three stocks are backed by strong fundamentals, including rising domestic demand for fuel and strong refining and marketing margins, which lends them a positive outlook for the near term. However, speculation over possible mergers among state-owned oil and gas companies to create integrated players is rife and stocks of different companies may react differently to any new information that comes out on this front. There have already been reports that either Hindustan Petroleum or Bharat Petroleum may be merged into ONGC. There are also reports that the government may want consolidation among some of its other undertakings as well. While these reports have been termed as speculative and premature by government officials, they have had an impact on stock prices and may continue to do so in case more such reports come out over the next few days. In the absence of any other major triggers, movement in shares of oil companies is likely to be influenced by crude oil prices, news flow, and sentiment in the broader market. Prices of crude oil have appreciated in the past three months and have been stable at around $55 per barrel for some time now. This has helped stocks of upstream companies such as ONGC, Cairn India Ltd, and Oil India Ltd. The outlook for upstream companies also remains positive in the near term, as the newfound strength in crude oil prices has not waned. The rise in prices of crude oil followed the decision of the Organization of the Petroleum Exporting Countries to cut output by 1.8 mln bbl per day in the first six months of 2017.
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Oil Stocks Outlook for the week – 06 to 10.03.2017
( www.rupeedesk.in )
