Nirmal Bang: Rising Gas Offtake And Cheaper Oil Support OMCs, Gas Stocks

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Nirmal Bang Report.We see the recent 10% fall in crude oil price amid the increase in OPEC plus supplies by 1.9 million barrel per day - on tapering output cut from 9.6 mnbpd to 7.7mnbpd - as a near term tailwind for Indian oil marketing companies (OMCs) as it is likely to boost their retail margins.The uncertain outlook for oil demand growth is likely to persist as we see a second wave of Covid-19 across the U.S., Europe and emerging economies, with China alone showing a revival.This is likely to sustain the pressure on gross refining margins (GRMs) for some time, but the prospects for inventory gains (specific to each refiner) could offer some respite to OMCs in refining earnings.Further, with retail margins likely to remain healthy under subdued oil prices (40-45/ barrel of oil U.S. dollar), the risk-reward in OMCs is set to improve.We also see positive trends in gas demand from bulk segments, including power, which is leading the pack.Key risk: OPEC+ announcing fresh cuts in production, implying a near term rally in oil prices..Click on the attachment to read the full report:.DISCLAIMERThis report is authored by an external party. BloombergQuint does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the brokerage and do not represent the views of BloombergQuint. .Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Nirmal Bang: Rising Gas Offtake And Cheaper Oil Support OMCs, Gas Stocks

Nirmal Bang: Rising Gas Offtake And Cheaper Oil Support OMCs, Gas Stocks

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