ONGC share price jumps 7%, biggest gain in 17 months; 3 key reasons behind the rally

Shares of state-run oil explorer Oil and Natural Gas Corporation (ONGC) surged in Wednesday’s trade, rising over 7% to hit the day’s high of Rs 266.05 on the BSE. The counter recorded the biggest single-day surge in over 17 months.

At 11:29 am, ONGC stock was trading at Rs 263.40, up 6.19% against its previous close of Rs 248.05 on BSE. A rally last seen when the stock closed 7.51% higher at Rs 329.10 on August 7, 2024

So, what are the reasons behind this rally?

One of the possible reasons could be ONGC's joint venture entering into a shipbuilding pact to boost the energy supply chain.  Another could be the global surge in crude oil prices, which have touched a four-month high. Also, agreement between ONGC and Reliance Industries Limited (RIL) to share deepwater resources on India's East Coast.

Brent Crude is trading near the $67 per barrel mark, with the rise attributed to extreme cold weather disrupting production across the US and indicating tighter supplies.

ONGC’s joint venture companies with Japan's Mitsui O.S.K. Lines (MOL) have signed contracts with Samsung Heavy Industries of South Korea to build two state-of-the-art very large ethane carriers (VLECs). The deal was inked on January 27, 2026, during the India Energy Week in Goa.

The two vessels will be Indian-flag carriers with a cargo capacity of one lakh cubic meters each. These specialised ships are designed to transport about 600 KTPA of ethane from the USA to India for OPal, a subsidiary of ONGC.

The vessels are scheduled for delivery in FY 2028-29. To manage this, ONGC and MOL have set up two dedicated entities in GIFT City, Gujarat, Bharat Ethane One IFSC Pvt. Ltd. and Bharat Ethane Two IFSC Pvt. Ltd, which will own and operate the carriers, the company informed stock exchanges in a late filing on Tuesday. 

Additionally, ONGC has signed long-term agreements with these JVs to ensure a stable, dedicated corridor for energy feedstock movement.

ONGC and Reliance have signed an agreement to enable resource sharing for deepwater offshore exploration and production (E&P) operations. The pact, signed on January 27, 2026, specifically targets the complex and capital-intensive Krishna Godavari (KG) basin and Andaman offshore regions.