Shares of three PSU OMCs rose by 1.84% to 4.03% at 9:50 IST on BSE after brent crude prices fell by more than 2% today, 25 November 2013, following a key deal between world powers and Iran on its controversial nuclear programme.
HPCL (up 4.03%), BPCL (up 2.54%) and Indian Oil Corporation (up 1.84%), edged higher.
The BSE Sensex was up 265.53 points, or 1.31% at 20,482.92.
Brent crude slumped after Iran and world powers reached an initial agreement on the Islamic republic's nuclear program that will loosen economic sanctions while maintaining a cap on oil sales.
Brent North Sea crude, the European benchmark, for January delivery fell $2.45, or 2.21%, in early Asian trade to $108.60, while New York's main contract, West Texas Intermediate (WTI) for January, was down 81 cents, or about 0.85%, at $94.03.
According to media reports, Iran agreed to curb its nuclear programme for the next six months in exchange for limited sanctions relief, in a preliminary accord with world powers meant to lay the foundations for a comprehensive agreement later this year. The deal was reached in marathon talks in Geneva that ended Sunday, 24 November 2013, after protracted negotiations between Iran and the so-called P5+1 nations comprising the United States, China, France, Britain, Russia and Germany.
Media reports, however, added that the impact of the deal on global oil supply will however be limited since much of the sanctions continue to remain in place.
PSU OMCs, or public sector oil marketing companies, suffer under recoveries on domestic sale of diesel, LPG and kerosene at controlled prices. In January 2013, the government allowed PSU OMCs to raise diesel prices in small measures at regular intervals while completely deregulating diesel prices sold to institutional or bulk buyers. The government has already freed pricing of petrol.
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