Sentiment takes a U-turn for OMCs

Upward bias in crude oil prices adds to woes over marketing margins

Until last month, it was mostly good-going for oil marketing companies (OMCs) such as Hindustan Petroleum, (HPCL), Bharat Petroleum (BPCL) and Indian Oil (IOC). But, sentiment did an about-turn when their share prices tanked 8-11 per cent in the last one month.
 
If analysts are to be believed, the near-term headwinds in the form of volatility in crude oil prices would continue to weigh on the stock prices.
 
The OMC stocks had scaled to their 52-week highs about a month ago, following a spike in Singapore-benchmark gross refining margins (GRM). The OMCs, which have huge refining capacities, benefit