Share prices of oil marketing companies (OMCs) were trading lower on Monday as international oil prices rose as much as 19% in early Asian trade, following an attack on Saudi Arabian refining facilities that disrupted global oil supply and soared tensions in the Middle East.
Post the attack, state oil giant Saudi Aramco, that is reportedly readying itself for the world's largest IPO, halted production of 5.7 million barrels of crude a day, more than 5% of the world's daily crude oil production leading to a surge in global oil prices. Brent crude, the international oil benchmark, surged $7.84 per barrel, or 13%, to $68.06 per barrel.
Reacting to this, the Indian equity market opened 0.50% lower each on Monday's trading session with Sensex falling over 200 points to 37,161 and Nifty losing 76 points to 10,999.
The Nifty Energy index was trading lower by 1.24% or 184 points at 14,544.05, a mere 9.9% higher from the 52-week low of Rs 13,104.
The biggest loser among OMCs was Bharat Petroleum Corporation Limited (BPCL), that fell 5.36% to Rs 386.65, followed by Hindustan Petroleum Corporation Limited (HPCL), trading 5.22% lower at Rs 257 on NSE. While Indian Oil Corporation (IOC) registered a 2.4% decline to Rs 126.90, Reliance Industries fell 1.5% lower to trade at 1,206.35 on NSE.
However, prices eased off their peaks after US President Donald Trump said he had authorised the use of the US emergency oil stockpile to ensure stable supplies after the attack.
"There is a reason to believe that we know the culprit, are locked and loaded depending on verification, but are waiting to hear from the Kingdom as to who they believe was the cause of this attack, and under what terms we would proceed!" Trump said on Twitter.
By Rupa Burman Roy