Why paints stocks are down today? How crude prices amid Iran, Israel, US news are impacting the shares

Shares of Asian Paints, Kansai Nerolac, Akzo Nobel, Indigo Paints, Berger Paints, and Shalimar Paints tanked up to 15% in early deals on Monday amid a boil in oil prices as US-Iran war escalated. The increase in crude prices poses a challenge for paint companies as oil and its derivatives are key components used in the paint industry. 

Brent crude prices rose 12.37% to $81.89 per barrel today. 

In the current session, Asian Paints shares fell 6.12% to Rs 2230.80 against the previous  close of Rs 2376.25. Market cap of the firm fell to Rs 2.20 lakh crore. 

The stock has lost 22% in three months and fallen 19.15% in two years. The paints stock is down 19% in three years.  

On similar lines, Kansai Nerolac shares crashed 6.41% to Rs 191.05 against the previous  close of Rs 204.15. Market cap of the firm fell to Rs 16,061 crore.

Shares of another paint major Akzo Nobel fell 4.28% to Rs 2808.60 against the previous close of Rs 2934.40. Market cap of the firm slipped to Rs 13,299 crore.

 
Indigo Paints stock too fell 3.92% to Rs 897.70. Market cap of the firm slipped to Rs 4362 crore.

Berger Paints, another paint major listed on BSE and NSE, slipped 5.81% to Rs 429.55. Market cap of the firm stood at Rs 52,171 crore. The maximum fall in the paints stocks came in Shalimar Paints, which crashed 15.33% to Rs 47.11 against the previous close of Rs 55.64. 

The closure of Strait of Hormuz by Iran could pose more risks for the global oil supply. 

According to global research and consultancy group Wood Mackenzie, rising oil and gas prices are imminent as the closure of the Strait of Hormuz threatens to disrupt 15% of global oil supply and 20% of global LNG supply. This could result in oil prices potentially exceeding $100/bbl if tanker flows are not quickly restored, said the energy consulting firm.