Crude Oil Prices Surge as US Sanctions Hit Russian Giants; ONGC, Oil India, BPCL, Reliance in Focus

Mumbai, October 24

“Massive Sanctions” Send Shockwaves Through Energy Markets

Announcing the measures in Washington, US President Donald Trump described the new restrictions as “massive sanctions aimed at moving Russian President Vladimir Putin to the negotiating table and ending Moscow’s brutal war in Ukraine.”

The sanctions target Russia’s two biggest energy producers, which together account for more than 5 percent of global crude output.
“By striking the heart of Russia’s oil sector, we are cutting off the engine that funds its aggression,” Trump said in prepared remarks.

Putin, however, remained defiant. According to Reuters, the Russian president vowed that Moscow “will continue to meet global energy commitments despite Western interference.”

The immediate market reaction was sharp. Brent crude futures surged past $65 a barrel, while US WTI crude rose above $61, both heading for their largest weekly advance in four months. Traders cited tightening supply expectations as Chinese state refiners paused Russian crude purchases, and Indian refiners signalled plans to reduce imports by nearly 40 percent.

Also Read: Midwest Share Price Today: Stock Lists 9% Above Issue Price on Strong Debut

Indian Market Reaction: Upstream Gains, OMCs Under Pressure

The sanctions ripple reached Dalal Street on Friday.
Shares of Oil and Natural Gas Corporation (ONGC) and Oil India Ltd opened higher, up about 1 percent each on the NSE, supported by firmer crude realisations.

By contrast, oil-marketing companies — Bharat Petroleum (BPCL), Hindustan Petroleum (HPCL) and Indian Oil (IOC) — fell between 1 and 3 percent as the spike in crude threatens marketing margins.

The Nifty Oil & Gas index hovered around 11,600 points, reflecting the tug-of-war between upstream benefit and downstream stress.

Analysts warned that a prolonged rally above $80 could raise India’s import bill and stoke inflationary pressures, though the government may use buffer reserves to cushion any immediate impact.

Global Reaction: Supply Concerns Meet OPEC Caution

The U.S. sanctions also rattled policymakers worldwide.
Kuwait’s oil minister told reporters that OPEC stands ready to offset any shortfall by rolling back existing output cuts if prices overshoot.
Commodity strategist Satoru Yoshida of Rakuten Securities noted, “Buying driven by supply-tightness concerns over the sanctions has subsided for now, but volatility is here to stay. With OPEC holding spare capacity, a one-sided rally is unlikely.”

Still, traders remain cautious ahead of the November 2 OPEC+ meeting, where members will reassess production quotas amid fears of further escalation.

Experts at PL Capital Weigh In

Experts at PL Capital said that while short-term volatility is unavoidable, the medium-term outlook for energy equities remains constructive.
They expect crude oil to stabilise in the $70 – $80 per-barrel range as spare capacity and demand normalise.

“Rising Brent prices will aid upstream producers like ONGC and Oil India, but they will compress refining and marketing margins for OMCs,” Swarnendu Bhushan, Co Head of Research- PL Capital.

According to the firm’s Cross-Sector Analysis (October 2025), Oil India (Target ₹525), ONGC (Target ₹278) and Mahanagar Gas (Target ₹1,471) remain its preferred picks, thanks to low leverage and resilient profitability.

In the integrated energy space, Reliance Industries Ltd (RIL) continues to stand out.

Bhushan highlighted Q2FY26 EBITDA of ₹458.9 billion, driven by strength in oil-to-chemicals (O2C), retail, and telecom. The brokerage retains a ‘Buy’ rating with a target price of ₹1,609.

Meanwhile, Mangalore Refinery and Petrochemicals Ltd (MRPL) showed a sharp turnaround, with FY26E EBITDA projected at ₹46 billion and PAT at ₹15 billion, earning an ‘Accumulate’ call with a ₹159 target.

Also Read: Larsen & Toubro: The Big Bet on India’s Infrastructure Cycle

India’s Energy Outlook: Balancing Risk and Opportunity

For India, the sanctions underscore a familiar dilemma — rising crude costs versus energy security.
While refiners may trim Russian purchases, diversification into Middle-Eastern and African grades is expected to limit disruption. Economists believe the RBI will stay alert for inflation spill-overs, but strong domestic demand and capital-expenditure momentum should cushion growth.

With global oil markets entering another unpredictable phase, investors are advised to stay selective. Upstream producers could benefit from better realisations, but refining margins will remain under pressure until crude stabilises.

Stay updated with every development on the India–US trade deal — your one-stop destination for expert insights, market impact, and key updates.- Click Here