Oil India share jumps 6%, rebounds to 1-year high after 3 weeks: Read why

With crude crossing $94 per barrel, upstream companies like OIL will benefit from higher net crude realisations; company also exploring ways to repatriate its dividends worth $150 million from Russia

The stock price of Oil India (OIL) surged 6 per cent on Friday to rebound to near its 52-week high after 3 weeks. The stock hit an intra-day high of Rs 294.4. It's one-year high level of Rs 296.95 was touched on August 23. 

The gains came after the company's CMD Ranjit Rath made a slew of announcements on OIL's growth outlook and told media that the company is exploring all channels to repatriate its dividends worth $150 million from Russia. 

OIL is expecting a series of new wells and gas fields to go into production in Assam and Rajasthan soon. This development will enable the company to achieve a crude oil production of 3.8 million tonnes (mt) in the current year, up 20 per cent over the 3.18 mt of oil produced in 2022-23 (FY23), said the CMD. READ DETAILS

At 12:50 pm, the stock was trading off highs at Rs 285 with a gain of 2.8 per cent. In comparison, the Nifty Oil & Gas index was down 0.5 per cent. 

As per reports, the company is exploring legal as well as diplomatic channels to repatriate its $150 million worth of dividends that have remained stuck since financial sanctions were placed on Russia. 

"After economic sanctions against Russia came in, about $150 million from Oil India is lying in one of the State Bank of India’s branches in Moscow. It is a matter of time before we are able to negotiate and get the money repatriated. Multiple channels of discussion processes are being evaluated including the legal options alternatives, G2G engagements. So, it is not a concern,” CMD Rath told ET Now. 

Indian Oil Corporation, BPCL, and ONGC also have dividends stuck in Russia due to banking restrictions and western sanctions. 

In another report by PTI, oil companies are looking at the possibility of using close to $600 million of their dividend income stranded in Russia to buy oil from that country, the report cited officials as saying.

OIL's Rath also highlighted the company's renewable energy plans amid high crude oil prices. The company is planning to invest around Rs 25,000 crore ($3.38 billion) to achieve a net-zero status by 2040.

In the 2G ethanol space, OIL is looking to invest Rs 8,000 crore, Rath said.

With crude crossing 10-month highs of $94 per barrel, upstream companies like OIL will benefit from higher net crude realisations, aided by cheaper imports of Russian crude. 

In the last 3 months, the stock has gained almost 10 per cent from a level of Rs 253 touched on June 15, 2023.