ONGC, OMCs in focus as Trump's Iran pause sends crude below $100

US President Donald Trump has announced a two-week halt to US military operations against Iran to allow room for negotiations, subject to the immediate reopening of the Strait of Hormuz.

The announcement was made on Truth Social shortly after Wall Street futures began trading following the close of the regular session.

Crude oil prices

reacted sharply to the development, emerging as the biggest casualty of the ceasefire move. Both Brent and West Texas Intermediate (WTI) fell as much as 17% in early Asian trade, slipping below the $100 per barrel mark.

Prior to the announcement, oil prices had surged amid escalating tensions.

WTI had climbed to as high as $116.9 per barrel on Tuesday following reports of US strikes on Iran's Kharg Island, a key energy export hub. Brent, too, had tested the $120 mark in the early phase of the conflict but repeatedly failed to sustain above those levels.

Notably, WTI had been trading at a premium to Brent over the last two sessions, with the spread widening to its highest level since the 2008 global financial crisis.

The sharp correction in crude prices has mixed implications for oil companies.

Lower crude prices are typically negative for upstream players like ONGC and Oil India, but positive for downstream refiners such as HPCL, BPCL, and Indian Oil.

For ONGC, every $1 per barrel decline in crude prices can impact annual revenue by ₹300 crore to ₹400 crore. Conversely, refiners stand to benefit, with EBITDA improving by ₹200 crore to ₹300 crore for every $1 per barrel drop in crude.

In Tuesday's session, shares of HPCL and Indian Oil rose 0.49% and 0.48%, respectively, while BPCL declined 0.43%. ONGC shares ended 1.65% higher.