Indian Oil, HPCL, BPCL Share Price Target: Domestic brokerage firm HDFC Securities has recommended a BUY rating on oil marketing companies (OMCs) -- Indian Oil Corporation Ltd (IOCL), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL). The buy recommendation has come at a time when oil supplies have been hit hard amid the Middle East crisis involving the US, Israel and Iran.

The brokerage has recommended buying IOC, BPCL and HPCL shares for a target price of Rs 190, Rs 455, 579, respectively.

HDFC Securities has also recommended a BUY rating on Oil India for a target price of Rs 520. On ONGC, the brokerage has recommended a REDUCE rating for the target price of Rs 220.

The brokerage said that the US-Israel vs Iran war has led to the closure of The Strait of Hormuz and production cuts at various oil fields in Iraq, Saudi Arabia, and Kuwait. The war has disrupted the global supply chain of crude oil, resulting in Brent Crude Oil prices surging beyond USD 100/bbl, up from USD 73/bbl.

India is dependent on crude oil imports to meet its fuel and energy requirements. The country is not insulated from the disruptions in the global oil market.

Currently, more than 50  per cent of India’s oil imports flow through the Strait of Hormuz and Indian refiners face the challenge of meeting the country’s crude oil requirement amidst limited crude oil availability.

For every USD 5/bbl increase in Brent crude oil price above USD 70/bbl, ONGC/Oil India’s standalone annual EPS goes up by 14/9 per cent.

"We prefer Oil India over ONGC, given the former’s better growth in production volumes in comparison to ONGC’s declining production volume," HDFC Securities said.