InvestorQ : What is your view on oil stocks like ONGC, IOCL and BPCL at current prices? Are they good buys?
Dhwani Mehta made post

What is your view on oil stocks like ONGC, IOCL and BPCL at current prices? Are they good buys?

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Dilmini Mercia answered.
3 weeks ago
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With metal stocks now coming under a cloud after the recent downgrade by Credit Suisse, the big question is which commodity to focus on? One answer could be oil. At least Chris Wood of Jefferies is extremely positive about oil sector in India. This is despite concerns that a nuclear deal with Iran could boost supply and depress crude prices. Wood sees oil companies as the biggest of the opening of the economies and gradual economic recovery.

Brent crude prices have already jumped over 93% yoy to $70/bbl. Experts are pegging the immediate targets for oil at $80/bbl as the demand may have been underestimated. Oil extraction and refining companies are likely to benefit from higher crude prices as it triggers better GRMs and better gains from inventory translation gains. Wood feels that although Indian oil stocks have rallied by 15-20%, the rally may have just begun, with lot of steam left.

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