Tag: crude prices

Castrol India shows resilience amidst market decline, but long-term performance remains challenging

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In a tumultuous market environment where most stocks experienced a decline, Castrol India stood out as a notable exception, demonstrating a positive trend with an increase of approximately 2-2.5 percent. This growth was further accompanied by robust trading volumes, nearly three times higher than the previous two weeks combined.

While this performance is encouraging in the short term, it is essential to examine the stock’s long-term trajectory, which has been marked by underperformance. This article delves into the recent developments in Castrol India’s stock and explores factors that could potentially impact its future performance.

When considering Castrol India’s long-term performance, it becomes evident that the stock has struggled to keep pace with the market. As of June, the stock experienced a modest gain of 6 percent, and throughout 2023, it has seen an overall increase of approximately 4 percent. Remarkably, up until the start of June, the stock had actually incurred losses for the year. Over the past 12 months, Castrol India’s rally has been moderate, with a modest increase of around 19 percent.

Furthermore, the stock remains approximately 6.5 percent below its 52-week high, indicating ongoing challenges in achieving sustained growth.

Despite its long-term underperformance, Castrol India has shown signs of recovery from its recent lows. It has managed to recoup approximately 20 percent from its 52-week low, indicating an upward trend in the stock’s value. This rebound could be attributed to several factors, including increased interest and positive sentiment surrounding the auto sector, of which Castrol is a part.

The surge in various auto, auto ancillary, and tyre stocks has positively impacted Castrol India. As a company closely associated with the auto sector, Castrol stands to benefit from this trend. Moreover, the stability in crude prices has provided a favorable environment for the company. By closely monitoring key factors such as trading volumes, profit margins, and potential market share improvements, investors and market watchers can gain insights into the stock’s future performance.

With the auto industry performing well and raw material prices stabilizing, market observers are keen to determine if Castrol India can maintain its positive momentum. The company’s ability to leverage its association with the thriving auto sector, coupled with steady crude prices, presents an opportunity for growth. Market participants will closely watch for indications of improved trading volumes and margins, as well as any signs of market share expansion for Castrol India.

While Castrol India demonstrated strength amidst a market decline, its long-term performance continues to be a concern. The stock’s recent gains of around 2-2.5 percent and significant trading volumes indicate short-term promise. However, the stock’s underperformance in the longer term, with a modest increase of 4 percent in 2023 and 19 percent over the last 12 months, highlights the challenges it faces.

With the auto sector performing well and stable crude prices, Castrol India has the potential for a positive trajectory, but market participants will be closely monitoring key factors to gauge the company’s future performance.

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Brent crude falls below $100/bbl on higher dollar, weak demand outlook

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Global crude oil benchmark Brent crude tumbled $7 to below $100 a barrel on Tuesday on a strengthening dollar, demand-sapping COVID-19 curbs in top crude importer China, and rising fears of a global economic slowdown, reported Reuters.

The sharp drop followed a month of volatile trading in which investors have sold oil positions on worries that aggressive interest rate hikes to stem inflation will spur an economic downturn that will pull the rug out from oil demand, Reuters reported.

Oil prices are facing extreme pressure “as a defensive posture continues with consumer sentiment still in a depressed mode along with a COVID re-surface in China,” said Dennis Kissler, senior vice president for trading at BOK Financial.

The dollar index, which tracks the currency against a basket of six counterparts, earlier on Tuesday climbed to 108.56, its highest level since October 2002. Investors tend to view the dollar as a safe haven during market volatility.

Investors have been dumping petroleum-related derivatives at one of the fastest rates of the pandemic era as recession fears intensify. Hedge funds and other money managers sold the equivalent of 110 million barrels in the six most important petroleum-related futures and options contracts in the week to July 5.

With Reuters inputs

Also read: Oil slides as renewed China COVID curbs temper fuel demand outlook

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News Wrap April 12: India’s March CPI rises to 6.95%; US reports highest inflation since 1981; Multiple people shot at NYC train station

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In top developments today, India’s retail inflation as measured by the Consumer Price Index (CPI) jumped to 6.95 percent in the month of March 2022 as compared to 4.29 percent reported in the year-ago period. Meanwhile, the inflation in the United States jumped 8.5 percent in March from 12 months earlier — the biggest year-over-year increase since December 1981. Also, multiple people were shot at a subway station in Brooklyn, New York, the city fire department said.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

India looking at all options to import crude at affordable rates: MoF

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The government is exploring all viable options, including import diversification, to procure crude at an affordable price, said the Ministry of Finance on April 7. The present price levels of international crude price, should it persist for long, may come in the way of India achieving real economic growth rate of 8 percent in FY23.

Also read: Indian market’s sensitivity to crude oil high; overweight on financial space: JP Morgan

The Indian economy has swiftly recovered in 2021-22, after the pandemic induced contraction and may prove resilient owing to the government’s thrust on capital expenditure and the corporate sector’s improved financial health.

However, geopolitical conflicts and their impact on food, fertiliser and crude oil prices have cast a cloud on growth outlook globally, and India may also feel its impact.

Also read: US offered partnership to India in reducing Russian crude oil reliance

The magnitude of impact will depend upon:

• How long the dislocations in energy and food markets persist in financial year.
• How resilient India’s economy is to mitigate the impact.
• However, transient shocks may not have a big effect on real growth and inflation.

The economic fallout of Russia- Ukraine crisis is gradually unfolding and has led to the prices of international fertilisers stabilising at higher than pre-conflict levels. Eventually, the prices may fall depending on the global dynamics. At present, the economy is benefiting from continued growth momentum in agriculture.

Also read: India to get Russian crude oil at $35 per barrel discount: Report

The first advance estimates of production of horticulture crops for 2021-22 indicate increase in sown area of both fruits and vegetables. It is expected that the constant increase in acreage under summer crops, crop diversification and increase in procurement during the ongoing kharif market season (KMS) 2021-22 will boost income levels in the rural economy.

Also read: Here’s a look at volatility in crude oil prices over the years

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Petrol pumps shut across India after 25% hike in bulk diesel prices

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Multiple petrol pumps across India were shut on Monday after the 25 percent hike in diesel prices. Following the climb up in international crude prices, the price of diesel sold to bulk users in India was hiked by about Rs 25 per litre.

Diesel will be sold to bulk users for Rs 122.05 per litre in Mumbai and at Rs 115 per litre in Delhi. Retail rates at petrol pumps, however, remains unchanged.

The worst-hit are private retailers like Nayara Energy, Jio-bp and Shell, who have so far refused to curtail any volume despite a surge in sales. Several pumps of Shell, Nayara and Jio-bp were shut claiming that customers are now opting for IOC, BPCL, HPCL and they can’t compete with these companies.

Also Read | India buys Russian oil despite pressure for sanctions

The wide difference of about Rs 25 per litre between the bulk user rate and petrol pump price has prompted bulk users to refuel at petrol pumps rather than book tankers directly from oil companies, they said. This has led to widening losses of oil companies, who were already bleeding from selling petrol and diesel at way below the cost.

Stock availability is not a problem for Mumbai and Maharashtra as of now.

Disclosure: Network18, the parent company of CNBCTV18.com, is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow