Oct 2, 2022

The Crude futures has moved over 15% in the last 20 trading days and its having its impact across sectors and industries. The opening up theme is being too optimistically priced in the crude prices. If this rally continues the AUTO , PAINTS , & FMCG stocks will be affected . But currently we are seeing market anomalies wherein these sectors are performing well with the Brent crude surge.

Since the input cost is increasing its impacting the overall consumer inflation and in short term we can see price hikes across all these sectors. Automobile & paint makers have no choice other than increasing their selling price. On the other hand its a superb opportunity for machinery , pipes , wielding and Oil drilling parts suppliers as we can see the increase in number of rigs being drilled globally.

The crude might relax a bit after Iranian oil hits the open the market , but that is still undeceive as of today . The USA forecast of limited supply in 2021 might keep this rally up and running . But as we have seen in past the Oil markets are unpredictable and they are very sensitive to geo political decisions.

The OPEC expects limited US oil output growth this year despite rising prices. – OPEC Public News

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