Why ONGC Share Price is Rising

# Royalty Cut Relief

According to the media reports, shares of ONGC surged nearly 6% after a major government decision.

The trigger behind this rally is a significant cut in royalty rates, the fee that companies like Oil and Natural Gas Corporation (ONGC) and Oil India pay to the government for extracting crude oil and natural gas from India's reserves. These royalties are usually calculated as a percentage of the value of the oil or gas produced, so even a small change in rates can have a big impact on earnings.

When royalty rates go up, oil & gas companies must pay more to the government, which increases their costs and reduces their profits, while reduced rates enhance profitability.

This was the main reason for the share price to surge.

What Next for ONGC?

Going forward, the company is strategically important for India's energy security. Given the recent surge in crude prices, the nation is accelerating its energy security strategy by boosting domestic oil and gas production. This has gained urgency due to geopolitical tensions and surging oil prices.

ONGC has over 20 major development, redevelopment, and infrastructure revamp projects under execution, with a capex of about Rs 770 bn.

These projects are designed to augment production and sharpen operational efficiency, which will ensure sustained growth. Importantly, four key infrastructure and revamp projects are slated for near-term completion.

Overall, rising crude prices and government-backed exploration programs, including deep-water drilling, support production growth at ONGC.

However, there are some important caveats. Crude oil prices are inherently volatile, influenced by geopolitical events, supply-demand imbalances, global economic trends, and decisions by major producers like OPEC. A sudden drop in prices can erode profits quickly, even if production volumes remain stable.

How ONGC Shares Have Performed Recently

In the past six months, ONGC shares jumped by 16.5%.

The stock touched its 52-week high of Rs 307.5 on 29 April 2026 and its 52-week low of Rs 228.8 on 17 December 2025.

About ONGC

ONGC is India's largest oil and gas exploration and production company. It's a dominant player in India's energy sector, contributing around 70-71% of the country's domestic crude oil production and about 84% of natural gas production.

The Maharatna PSU is vertically integrated across the entire oil and gas industry, involved in exploration, development, and production activities across basins in India.

ONGC also has an international subsidiary, ONGC Videsh, which explores and produces oil and gas in 15 countries, expanding India's energy footprint globally. Its Indian subsidiaries include Hindustan Petroleum Corporation and Mangalore Refinery and Petrochemicals.

To know more, check out ONGC fact sheet and latest quarterly results.

For a sector overview, read our energy sector report.

You can also compare ONGC with its peers on our website.

ONGC vs Oil India

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Happy Investing.

Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

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