ONGC, Oil India gain after oil hits 2016 high

Shares of oil companies were trading higher by up to 4% after crude oil prices hit 2016 highs on Tuesday. Oil & Natural Gas Corporation (ONGC) has gained 4% to 222, followed by Oil India (3% at Rs 328), and Cairn India (2% at Rs 148) on BSE.

Crude oil prices hit 2016 highs on Tuesday on the back of a rally in the gasoline market and after an industry group reported a surprise draw in U.S. crude stockpiles, according to a Reuters report.

Brent and U.S. crude's West Texas Intermediate (WTI) futures finished regular trading about 3% higher, riding on the coattails of a gasoline rally that hit August highs after a series of refinery hikes, added report.

Higher crude prices will result in higher realisation for these oil exploration companies and result in increased profitability for them.

Jindal Drilling & Industries (up 14% to Rs 156), Aban Offshore (8% to Rs 203), Selan Exploration Technology (4% at Rs 192) and Deep Industries (2% at Rs 167) are other companies which engaged in exploration & production business, rallied up to 14% as compared to 0.04% rise in the benchmark S&P BSE Sensex at 10:34 am.

Oil and Natural Gas Corporation Limited (ONGC)