3 Crude Oil Stocks to Watch Amid US-Venezuela Tensions

Venezuela faces tensions following recent US military strikes on Caracas that apprehended President Nicol's Maduro and his wife, Cilia Flores.

According to a PTI report, a possible US-backed restructuring of Venezuela's oil industry could deliver a meaningful financial and strategic gain for India, including recovery of nearly US$ 1 bn in long-pending dues and a restart of crude production from fields involving Indian companies.

Here are three stocks that you can watch as tensions ease, following the possibility of a US restructuring.

#1 ONGC

ONGC Videsh Ltd serves as the overseas arm of Oil and Natural Gas Corporation Limited (ONGC), focusing on international oil and gas exploration, development, and production.

According to reports, ONGC Videsh has a 40% stake in the San Cristobal onshore oilfield in eastern Venezuela, where PdVSA holds 60%.

Though the field is seen to be commercially viable, the US sanctions on Venezuela blocked access to rigs, equipment and services needed to sustain output, and the wells have practically dried up.

According to reports in the Financial Express, Venezuela failed to pay ONGC Videsh US$ 536 million (m) in dividends due on its 40% stake in the field up to 2014, and a near-equivalent amount for the subsequent period for which the Venezuelan authorities refused to permit audits, effectively freezing the claims settlement.

Should the US decide to change the status-quo, ONGC could benefit.

ONGC Snapshot (FY23-25)

	FY23	FY24	FY25
Net Sales (Rs m)	57,98,227	54,99,910	56,08,684
Operating Profit (Rs m)	8,70,669	11,60,119	10,24,502
Operating Margin %	15	21.1	18.3
Net Profit (Rs m)	3,40,465	5,52,731	3,83,286

Source: Equitymaster

Financially speaking, the company's revenues for Q2 FY26 were Rs 1,579,111 m compared to Rs 1,593,311 m YoY. For Q2FY26, ONGC reported a net profit of Rs 122,750 m compared to Rs 98,536 YoY. Its subsidiaries, HPCL and MRPL, are primarily responsible for the rise in net profits.

Moving ahead, the management of ONGC anticipates that oil production will reach 20 million metric tonnes in FY26. On the other hand, for gas production the estimated quantity is 21.5 BCM, which would be marginally lower than projected.

ONGC has in the past faced issues with declining and mature fields. However, with BP led TSP advancing for redevelopment of the MH Field, scheme for revival of KG-98/2 and combined Western Offshore Development Plan, ONGC is positioned to counterbalance declines from mature fields.

The accelerated monetisation of new hydrocarbon discovery alongside a sharper focus on deepwater and ultra-deepwater exploration is expanding ONGC's resource base.

#2 Reliance Industries

Next on the list is Reliance Industries.

The company is a major Indian multinational conglomerate, with diverse business operations spanning petrochemicals, refining, oil and gas exploration, retail, telecommunications, and digital services.

Reliance Industries stands to gain from easing US-Venezuela tensions through renewed access to discounted Venezuelan heavy crude oil, which its Jamnagar refinery is optimised to process.

This could boost gross refining margins amid potential sanction relief or US-led restructuring of Venezuela's oil sector.

Reliance Industries Financial Snapshot (FY23-25)

Source: Equitymaster

On the financial front, Reliance Industries reported revenues of Rs 2,588,980 m in Q2 FY26, against Rs 2,354,810 m in the corresponding period last year. The net profits surged to Rs 221,460 m in Q2 FY26, from Rs 191,010 m YoY.

Moving ahead, the business is currently advancing quickly in the clean energy sector. Reliance Industries intends to use a fully integrated, internationally competitive clean energy platform to achieve net carbon zero by 2035.

One of the biggest integrated renewable manufacturing hubs in the world is expected to be the Dhirubhai Ambani Green Energy Giga Complex.

Reliance Industries just put its first solar GW+ line into service. The company is well on its way to establishing 10 GW fully integrated solar PV manufacturing from polysilicon to ingot and wafer to cell/module along with glass and encapsulant and then expanding it in a modular fashion.

#3 Indian Oil Corporation (IOC)

Third on the list is Indian Oil Corporation.

IOC is India's largest integrated oil marketing company and a leading downstream player in the energy sector. It dominates the domestic fuel retail market with a vast network of refineries, pipelines and fuel stations.

According to reports IOC has the requisite complexity to process the Venezuela crude oil grades and blend efficiently.

Easing tensions could enable spot or term imports at discounts to Brent, improving gross refining margins amid diversified crude slates.

IOC Financial Snapshot (FY23 to FY25)

Source: Equitymaster

On the financial front, IOC reported revenues of Rs 2,064,471 m for Q2 FY26 against Rs 1,986,158 m YoY. The net profits were Rs 74,796 against loss in the corresponding period of the previous year.

Moving ahead, IOC plans to invest Rs 1.66 trillion over the next five years to expand its core operations in oil refining and fuel marketing, along with ventures in petrochemicals, natural gas, and renewable energy.

According to report in the Business Standard, to strengthen supply, the company's pipeline network will be expanded to 22,000 km through 21 ongoing projects, including new storage facilities in Nepal.

Conclusion

However, given the huge scale that these companies already have, one will have to see if the benefits are worthwhile.

This apart, there still has to be clarity on the policy front as to whether there would be a sanction relief from the US.

Careful analysis of company fundamentals, regulatory environment, and sector trends is essential before 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.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...