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Brent crude futures slipped below the $95-per-barrel mark to trade under $94, while WTI crude futures fell below $87 on Thursday morning.
The sharp decline in crude prices lifted sentiment towards companies that use oil as a key raw material, as well as airlines that have been grappling with elevated aviation fuel costs. Investors also cheered the prospect of lower input costs for paint and tyre makers, while easing crude prices could offer relief to oil marketing companies.
Crude-sensitive stocks rally
Among the airlines, IndiGo shares surged 7% to trade at Rs 5,489 apiece, while SpiceJet shares jumped around 5%. Paint-maker Asian Paints saw its shares rally nearly 7%, while those of peers Indigo Paints and Berger Paints jumped up to 5%.
MRF shares rallied more than 4%, with each share gaining Rs 4,995 to trade at Rs 1.23 lakh apiece. Apollo Tyres and Balkrishna Industries shares jumped more than 8%. Oil marketing companies, including Hindustan Petroleum Corporation (HPCL), Bharat Petroleum Corporation (BPCL) and Indian Oil Corporation (IOC) saw their share prices jump up to 7%.
Also read | Why is Dalal Street rallying today?
Why are oil prices falling today?
US President Donald Trump’s Republican party lost control over both the houses of Congress, the Senate and House of Representatives. This came after the US-Iran war spiked energy prices, with Americans beginning to feel the pinch in their pockets. In a lengthy post after the party’s election defeat, Vice President JD Vance acknowledged voter dissatisfaction over the war. He said this, along with rising cost of living and other factors may have led to voters’ dissatisfaction, which in turn led to Democrats’ sweeping victory in the midterm elections.
One of the things the data analysts on our side obsessed over was “composition”—whether the electorate looked close enough to 2024 for Republicans to win. And despite polls that showed a Democrat blowout, the data kept on telling us the same story: in some states turnout was merely OK, in other states it was downright amazing, and in no state was it catastrophic. There was a genuine sense of optimism on our team: our people were showing up. So, I asked the smartest data guy I know, does that mean we’re going to shock the world? “No,” he told me. “We might do better than the polls suggest. But the data is telling us that a lot of Trump/Vance 2024 voters are pissed and planning to vote for the other guys. Our voters are turning out, but they may not vote for us.”Well, that looks prophetic now. Our voters did show up. In Florida, for example, the electorate was 9 points more Republican than Democrat, just a couple points worse than 2024. Undoubtedly there were places we could have done better on turnout. But the main problem is not turnout. The main problem is that many people who voted for Trump/Vance in 2024 voted for Democrats in 2026. There will be a lot of infighting and arguing over what happened and why that is. One of the pollsters I really respect told me that our economic messaging wasn’t sharp enough down the stretch. I’m sure that’s true. But the real reason we lost is obvious to almost everyone. Another pollster—one of the smartest people I know in politics, told me yesterday we’d lose the generic ballot by 13 points. I felt negative going into Tuesday, but even I was shocked by this. In his polling, he saw that a lot of Trump 2024 voters were angry and planning to vote for Democrats. He asked those voters who had abandoned us what would cause them to come back on our team. The top four answers, accounting for nearly all of the responses were:1) End the war2) Focus on cost of living/inflation3) Put America First4) Change our relationship to IsraelOur voters showed up. And the above four reasons are why many of them voted for Democrats. This is according to a pollster who nailed the results. While many spent Monday attacking Rachel Campos Duffy for calling for a diplomatic resolution to the conflict, it turns out her political advice was sound. (She’s also a great person.)In the next few months, there’s going to be a lot of gaslighting. Expect to hear any number of establishment politicians say the solution to our woes is amnesty. I’m open to the idea that we should change enforcement—by focusing more on businesses that hire illegal labor, for instance. But anyone pushing amnesty is lying to you. The reason we lost is the war. The president himself said so last night. If you’d like to argue it was worth it, that losing the Senate for the next 6 years was worth it, then do so. Argue it was a worthwhile cost to pay. Agree or disagree, that’s at least honest.But everyone knows why we lost. And any honest conversation about where we go from here must start there.I remain hopeful about our country. To the people who are pissed off and want to say, “I told you so”: you’re right, you did tell us so. Take that energy into electing Republicans who share your worldview. To the people who are just pissed at the results, you should be. Let’s take that anger and get back to the work of saving our country.
— JD Vance (@JDVance) November 4, 2026
Senate Minority Leader Chuck Schumer, a Democrat, meanwhile pledged to bring the war to an end soon. “We are going to end the war,” he said at a news conference in Washington. “We have some Republicans already who have joined us in ending the war, and the Founding Fathers had the power of the purse as one of the ways of deterring a president who does war without the consent of the American people,” he said.
This retriggered hopes for a conclusion to the Middle East conflict that has been raging since late February this year following US and Israel’s joint military strikes on Iran, killing its former supreme leader, triggering a massive surge in oil prices and rattling global stock markets.
As a result, oil prices tumbled. “Markets are assessing the impact of the midterm elections to Donald Trump’s next steps with the Iran war, pricing in more likelihood for the war to end,” Reuters quoted June Goh, senior oil analyst at Sparta Commodities.
What lies ahead for crude sensitive stocks?
With majority in both the houses with the Democrats, war-related spending approvals are likely to be trimmed and may ease off crude oil supply related challenges through the Strait of Hormuz, said Sunny Agrawal, Head of Fundamental Research at SBI Securities. He noted that in case crude oil prices sustains below $90-100 per barrel, then the entire inflationary narrative will take back seat and this augurs well for the Indian economy and equity markets.
“We believe the crude or crude derivatives and interest rate sensitive sectors are likely to be the key beneficiaries in the short to medium term. With likely recovery in rupee, FII inflows should accelerate and should be positive for large and midcaps,” the analyst further said.
Disclaimer: This article has been written by Debaroti Adhikary, who is not a SEBI-registered Research Analyst or an Investment Adviser. Debaroti Adhikary and his/her ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective SEBI-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here.
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