Crude oil prices have surged to record highs amid the ongoing conflict in West Asia and supply disruptions caused by the blockade of the Strait of Hormuz, sending shockwaves through global energy markets. Meanwhile, Brent crude June futures climbed 4.90% today to 123.81 per barrel, trading at their highest level since 2022, while US crude oil WTI was up 2.20% to $109.23 per barrel.

What brokerages say

However, brokerages Prabhudas Lilladher (PL Capital) and Motilal Oswal Financial Services (MOFSL) noted that while the supply squeeze is real, shifting global demand dynamics and potential price hikes may present opportunities for select players.

According to a latest sector note by PL Capital, high fuel prices are already starting to bite into global consumption. The International Energy Agency (IEA) estimates a sharp demand decline of ~2.5 mbpd in April 2026 alone, it said.  
“Against a supply balance of ~4.8mbpd, such expected demand destruction will partially rebalance market dynamics further, putting a downward pressure on crude prices,” PL Capital added.

Further PL Capital noted that it remains positive on Hindustan Petroleum Corporation Ltd (HPCL), Bharat Petroleum Corporation Ltd (BPCL) and Indian Oil Corporation Ltd (IOC) noting “demand destruction led lower crude prices are expected to help improve marketing margins, partly offset by volume softness.”

Stock picks

MOFSL said a truce play is possible in Petronet LNG Ltd and HPCL, which makes the duo their preferred picks. 

“Marketing losses are expected to persist in 1Q, though they have narrowed sharply to ~INR15-25/liter. A price hike of INR2-4/liter is widely expected,” MOFSL said.

Targets & ratings

HPCL: MOFSL has a ‘Buy’ rating on the stock with a target price of Rs  420. PL Capital has revised its target multiples to 1.1x and tweaked its rating from ‘Buy; to ‘Accumulate’, setting a target price of Rs 421.  

BPCL: PL Capital revised BPCL's target multiple to 1.3x and maintained an ‘Accumulate’ rating with a target price of Rs 332. MOFSL gave the stock a ‘Neutral’ rating with a target of Rs 306.  

IOC: PL Capital upgraded its target multiple for the stock to 0.9x, maintaining an ‘Accumulate’ rating with a revised target price of Rs 163. MOFSL kept IOC at a ‘Neutral’ rating.  

Petronet LNG: For investors looking beyond traditional OMCs, MOFSL has a ‘Buy’ call on the stock with a target price of Rs 361.