Indian Oil-Dependent Stocks Plummet Up to 8% Amid Crude Price Surge Above $115

Crude-Price Surge Sends Stocks into a Tailspin

The Indian market experienced a sharp decline on Monday, with crude-sensitive stocks bearing the brunt of the losses. InterGlobe Aviation (IndiGo), SpiceJet, and Asian Paints plummeted as much as 8 percent, 6 percent, and 4 percent, respectively, as crude oil prices surged above $115 per barrel.

Tyre makers, including JK Tyre and Apollo Tyres, also saw significant losses, dropping 6.5 percent and 4 percent, respectively, due to concerns over rising raw material and fuel costs. Paint companies, which rely heavily on crude derivatives for inputs, were also under pressure, with Asian Paints, Berger Paints, Kansai Nerolac, and Akzo Nobel India falling between 3 percent and 4 percent.

The Sensex plummeted 2,401 points, or 3.04 percent, to 76,517, while the Nifty fell nearly 727 points, or 2.97 percent, to 23,723. Market breadth was sharply negative, with over 2,600 stocks declining against just about 537 advancing on the NSE.

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The sell-off was triggered by a dramatic surge in global crude prices following the escalation of the U.S.-Israeli conflict with Iran, which has raised fears of supply disruptions and shipping risks in the Strait of Hormuz, a key global oil transit route.

Analysts pointed out that sectors with high crude-linked input costs, including airlines, tyre manufacturers, and paint companies, are typically among the first to react to sharp spikes in oil prices. Higher fuel and petrochemical costs can directly squeeze margins, leading to a decline in stock prices.

The surge in oil prices represents a major macro shock for markets, with Brent crude spiking above $115. This could have significant economic consequences for big oil importers like India, potentially pushing inflation higher and complicating the outlook for interest rates and economic growth.

The weakness in crude-sensitive stocks also reflected the broader risk-off mood in markets. InterGlobe Aviation emerged among the top losers on the Nifty, while other stocks such as Maruti Suzuki, Larsen & Toubro, and State Bank of India also declined sharply in early trade.

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Volatility surged sharply, with the India VIX jumping more than 20 percent, signalling heightened investor nervousness as markets grapple with the implications of the oil shock and escalating geopolitical tensions. If crude prices remain elevated for a prolonged period, sectors dependent on fuel and petrochemical inputs could continue to face pressure, while broader markets may remain volatile.