New Delhi: Shares of major Indian oil refining companies fell on Monday after global crude oil prices jumped sharply due to the ongoing conflict involving the United States, Israel and Iran.
Global oil prices climbed close to their highest level since 2022 as fears grew that the conflict could disrupt energy supplies from the Middle East. Brent crude rose to around 119 dollars per barrel, raising concerns in global markets.
The rise in oil prices had an immediate impact on Indian energy companies. Shares of Indian Oil Corporation dropped about 4.6 percent, while Hindustan Petroleum Corporation fell nearly 4.9 percent. Bharat Petroleum Corporation recorded the steepest decline, falling around 5.4 percent during trading.
Investors are worried that rising crude prices could reduce the profits of Indian refiners. In India, fuel prices are partly controlled and companies often cannot fully pass higher costs on to consumers. When crude prices increase sharply, refiners usually face pressure on their margins.
India is particularly sensitive to changes in oil prices because the country imports more than 80 percent of its crude oil needs. A large portion of these imports come from the Middle East, the region now affected by growing military tensions.
The surge in prices is mainly linked to fears that shipping routes in the Gulf region could be disrupted. The Strait of Hormuz, one of the most important oil shipping routes in the world, carries about one fifth of global oil and gas supplies. Any disruption there could quickly affect global energy markets.
The broader Indian stock market also reacted to the situation. The Nifty oil and gas index dropped as investors reassessed the outlook for energy companies.
The Indian government is closely monitoring the situation as the conflict continues. Authorities have taken steps to increase domestic fuel production and are also exploring alternative sources of crude oil from countries such as the United States, Russia and parts of Africa to reduce dependence on Middle East supplies.
Analysts warn that if the conflict continues to escalate or if oil shipments through the Gulf are disrupted, global oil prices could rise even further, increasing pressure on economies that rely heavily on imported energy.