Oil & Gas Q4 Results Preview - OMCs Upbeat On Both Refining, Marketing Margins: ICICI Direct

ICICI Direct Report

Average crude oil prices in Q4 FY23 declined 8% QoQ to $81.4/barrel of oil. The steep decline was mainly seen in the second half of March due to recessionary fears surrounding the banking sector in the U.S. and Europe.

On a closing basis, crude oil prices were at around $79.7/bbl, down 6% QoQ.

For Oil and Natural Gas Corporation Ltd., oil realisation net of windfall taxes would remain unchanged QoQ at ~$75/bbl and gas realisation would also stand unchanged QoQ at $8.57/metric million British thermal unit on a gross calorific   basis.

Similarly, the ceiling price for Reliance Industries ltd. HPHT gas remained unchanged at $12.46/mmbtu (GCV basis). Also, ONGC and RIL’s volumes are expected to remain flattish QoQ.

We expect ~2% QoQ increase in operating profit for ONGC. For RIL’s oil and gas segment, we expect operating profit to remain flat QoQ.

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