Shares of three public sector oil marketing companies rose by 0.96% to 1.42% at 10:37 IST on BSE as crude oil prices eased and the Indian rupee strengthened against the dollar.
BPCL (up 1.42%), Indian Oil Corporation (up 1.33%) and HPCL (up 0.96%), edged higher.
The S&P BSE Sensex was up 113.13 points, or 0.53% at 21,389.99.
New York's main contract, West Texas Intermediate (WTI) for April delivery, was down 36 cents, or 0.35% at $101.09 in mid-morning Asian trade, while Brent North Sea crude for April was up 18 cents, or 0.17% to $107.94.
On Wednesday, 5 March 2014, crude oil for April delivery fell $1.88, or 1.8%, to settle at $101.45 a barrel on the New York Mercantile Exchange. On the ICE Futures exchange, Brent crude for the same month lost $1.54, or 1.4%, to end at $107.76 a barrel. Crude oil prices declined as geopolitical risks over Ukraine eased.
Lower crude oil prices will reduce underrecovery of public sector oil marketing companies (PSU OMCs) on domestic sales of diesel, kerosene and LPG at government controlled prices.
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In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 61.45, compared with its close of 61.75 on Wednesday, 5 March 2014. Gains in rupee against the dollar aided gains in shares of PSU OMCs. A firm rupee will reduce cost of crude oil imports. PSU OMCs import about 70-75% of their crude oil needs.
The standoff between Moscow and the West over Ukraine has been the main focus of oil investors this week as more than 70% of Russia's oil exports to Europe pass through the ex-Soviet state. Russia, which produced 10 million barrels a day in January, vies with Saudi Arabia as the world's largest oil producer, and is the second-largest producer of natural gas.
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