Introduction: ONGC Share Price Jumps Amid Global Oil Crisis
The Indian stock market saw significant action in energy sector stocks, especially ONGC (Oil and Natural Gas Corporation) and Oil India, after global oil prices spiked due to rising tensions in the Middle East. Investors found a silver lining as these oil producers' stocks surged sharply in Friday’s trading session.
ONGC share price rose by 3.09% to ₹255.55, while Oil India shares increased by 2.49% to ₹480. The sharp rally was primarily triggered by geopolitical developments between Israel and Iran, which have raised serious concerns about oil supply disruptions globally.
Let’s break down the news, understand the reasons behind the ONGC share price movement, and look at the broader implications for investors, oil markets, and the global economy.
Why Are ONGC and Oil India Shares Rising?
The key reason behind the rally in ONGC and Oil India shares is the sharp rise in Brent crude oil prices, which surged to $78.50 per barrel, their highest level since January 2025. The increase in oil prices benefits upstream oil companies like ONGC and Oil India because their revenues are directly linked to crude oil prices.
Events That Sparked The Price Rally:
- Israel launched attacks on Iran’s military and nuclear facilities.
- Multiple Iranian scientists and commanders were reportedly killed.
- Iran has promised a “harsh response”, creating fears of a prolonged conflict.
- The market fears that Iran’s oil supply could be significantly disrupted.
- Iran is one of the world’s largest oil producers, and China, a major global oil consumer, is its biggest customer.
All these developments created a panic-like situation in the oil markets, causing prices to shoot up and boosting stocks of companies like ONGC and Oil India.
ONGC Share Price: Performance Snapshot
| Date | ONGC Share Price (₹) | Change (%) |
|---|---|---|
| June 12, 2025 | ₹248.00 | - |
| June 13, 2025 | ₹255.55 | +3.09% |
Oil Price Trends: From Fall to Sudden Surge
In May 2025, Brent crude had fallen to $59 per barrel, the lowest level since February 2021. The price drop was due to lower global demand, rising inventories, and slower economic growth in major economies.
But the situation reversed suddenly:
- In just two weeks, Brent surged by over 13.8%, touching $78.50.
- By 9:32 AM on June 13, it was trading at $75.36, still up 8.72%.
This sharp rebound is attributed to geopolitical risks, something that energy investors watch very carefully.
Geopolitical Tensions and Their Impact on Oil Markets
Oil is perhaps the most politically sensitive commodity. Whenever there's conflict in oil-rich regions like the Middle East, the first market to react is crude oil.
Why the Middle East Matters:
- The region holds over 48% of the world’s proven oil reserves.
- Disruptions here cause immediate supply chain shocks.
- Countries like Iran, Iraq, Saudi Arabia, and UAE are key producers.
So when Israel attacks Iran, the ripple effect is felt globally. Traders start pricing in supply shortage risks, even if the actual flow of oil isn’t immediately impacted.
ONGC: India's Oil Giant
ONGC is India’s largest oil and gas exploration and production company. It’s a government-owned Maharatna PSU with a legacy that stretches back decades. Here's why ONGC matters:
Key Facts:
- Founded in 1956
- Contributes over 70% of India’s domestic oil production
- Has operations in India, Russia, Vietnam, and more
- Owns ONGC Videsh, the overseas arm handling foreign projects
Whenever international oil prices go up, ONGC benefits as its margins widen. A higher crude price means more revenue per barrel produced.
Oil India Limited: The Smaller Giant
While ONGC leads the way, Oil India Ltd. is the second-largest oil producer in India. Its shares also climbed nearly 2.5% on Friday.
Oil India has:
- Strong presence in Assam and North-East India
- Investments in overseas assets in Russia, Libya, Mozambique, and others
- Increasing focus on natural gas exploration
The company’s performance is also tightly linked to global crude price trends.
Impact on Consumers and Economy
While investors in ONGC and Oil India might be happy, the surge in oil prices has a downside:
Higher Oil Prices Can Lead To:
- Increase in petrol and diesel prices
- Rise in transport and logistics costs
- Higher inflation
- Negative impact on current account deficit and fiscal deficit
- Strain on importing countries like India, which buys over 80% of its crude oil
So while the ONGC share price may rally, the overall economy faces challenges if oil prices stay high for a long time.
What Should Investors Do?
If you're an investor or thinking about entering oil stocks, here are a few things to keep in mind:
Pros of Investing in ONGC:
- Benefits directly from rising crude prices
- Pays good dividends
- Government support as a PSU
- Strong fundamentals and global footprint
Risks:
- Vulnerable to global oil price volatility
- Sensitive to government policies (fuel subsidies, taxation)
- Can underperform if crude prices fall sharply
Analyst View:
Most brokerage houses remain cautiously optimistic on ONGC. Many believe that if Brent crude stays above $75, ONGC’s earnings will improve in FY26.
Long-Term Outlook for ONGC Share Price
The future of ONGC depends on several factors:
- Global crude oil prices
- India’s push toward green energy
- Exploration success in new oil blocks
- Operational efficiency
While the current rally is driven by global tension, ONGC has long-term value for investors seeking steady returns and dividend income.
China’s Role in This Crisis
An interesting part of this story is China. Iran exports a major chunk of its crude oil to China, which alone consumes over 20% of the world’s oil.
If Iran’s oil is blocked due to war or sanctions, China will have to look elsewhere, increasing demand for oil from other nations. That could push prices even higher, benefiting global producers like ONGC.
Conclusion: ONGC Share Price A Relief Rally or Trend Reversal?
The ONGC share price rally may look strong now, but whether it sustains depends on how long the Middle East tensions continue. If oil prices stabilize above $75-80 per barrel, ONGC and Oil India could continue to perform well.
But investors should also be cautious geopolitical-driven rallies are often short-lived if peace talks begin or tensions cool off.
Still, this event has shown how crucial crude oil is to India’s markets and how quickly ONGC share price can respond to global shocks.
Disclaimer
This article is for informational purposes only and does not constitute investment advice. Stock markets are subject to risk. Please consult with a certified financial advisor before making any investment decisions.
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