Crude Oil Surges on US-Iran Strikes: 7 Stocks in the Crossfire

Crude Oil Surges on US-Iran Strikes: 7 Stocks in the Crossfire

US airstrikes on Iranian targets sent crude oil prices surging on July 8, and Indian markets responded with their steepest fall in over three months. The Sensex crashed 1,677 points, the Nifty slipped below 24,000, and the India VIX — the market's fear gauge — spiked 26% in a single session. Investors lost Rs 2.79 lakh crore in market capitalization.

But beyond the headline panic, the question retail investors should be asking is: which companies actually have outsized exposure to crude oil, and which ones quietly benefit from exactly this scenario? We dug into corporate filings on NSE to find out.

The stocks that get hurt

InterGlobe Aviation (IndiGo) — Fuel is the single largest cost

IndiGo's own annual report for FY25 states it plainly: "Jet fuel is the most significant cost for an airline." Per their Q4 FY26 earnings transcript, fuel cost per available seat kilometer (CASK) was Rs 1.45 — and even that was after a roughly 5% year-over-year decline, thanks to lower Singapore jet fuel benchmarks. ATF prices in India are notified monthly by oil marketing companies with a one-month lag, meaning the current crude spike will start hitting IndiGo's cost base from August onward.

More critically, IndiGo disclosed that over 50% of its costs are US dollar-denominated. With crude rising and the rupee under pressure, it faces a double hit. The airline's EBITDAR margin for FY26 already dropped to 17.8% from 26.3% in FY25, per their investor presentation. Management flagged that "recent developments in the Middle East" had already impacted aircraft utilization and costs. Another prolonged spike could further compress what are already thin margins.

MRPL (Mangalore Refinery) — Already in the red before this spike

Standalone refiners are uniquely vulnerable. Per MRPL's Q2 FY26 earnings transcript, their gross refining margin (GRM) averaged just $3.88 per barrel, down sharply from $6.23 per barrel in Q4 FY25. The company posted an EBITDA of just Rs 218 crore and a net loss of Rs 272 crore for the quarter. Management explicitly attributed the loss to "crude price shocks" impacting the bottom line, alongside a plant shutdown and inventory losses.

Their FY25 annual report notes that crude oil prices ranged between $60 and $130 per barrel over the prior three years. When crude spikes suddenly, refiners holding crude inventory at lower prices benefit briefly — but sustained high prices compress the crack spread (the difference between crude input cost and refined product prices), squeezing margins hard.

Indigo Paints — Raw material costs spiked 50-100% in March

Here is a sector most investors overlook when crude oil spikes: paints. Per Indigo Paints' FY26 investor presentation, "Key raw material prices rose 50–100% in March 2026 due to the Middle East conflict, prompting the industry to implement multiple price hikes of about 12% to offset the cost increase." The company's key inputs — phthalic anhydride, pentaerythritol, and titanium dioxide — are crude oil derivatives.

While Indigo Paints said it aims to keep EBITDA margins intact through price hikes, the company also acknowledged it is "embarking on an aggressive growth path that may moderately affect gross margins." A fresh crude oil spike on top of an already-elevated raw material environment is a headwind for the entire decorative paints sector.

Castrol India — Base oil tracks crude directly

Per Castrol India's FY23 annual report, "volatility ruled the commodity market" when crude spiked — refiners prioritized fuel production over base oil, creating supply shortages. Their FY25 earnings transcript noted that base oil landed cost was already Rs 2 to Rs 3 per liter more expensive due to forex alone. With crude oil and the rupee both moving against them simultaneously, Castrol's cost of goods sold faces direct pressure. Management noted they manage this through shifting between local and international procurement and holding 25 to 40 days of inventory — but a sustained spike would overwhelm these buffers.

The stocks that quietly benefit

Oil India — Every dollar per barrel goes to the bottom line

Upstream oil producers are the mirror image of the companies above: rising crude prices flow directly into revenue. Per Oil India's FY25 investor presentation, the company produced 3.07 million metric tons of crude oil and reported standalone PAT of Rs 6,114 crore on revenue of Rs 23,987 crore, with an operating margin of 31%. Their gross crude realization reached $95.47 per barrel in FY23 when Brent averaged $96. With a debt-to-equity of just 0.27:1 and a return on capital employed of 15%, Oil India has the financial muscle to absorb volatility while passing price gains straight to the bottom line.

ONGC — India's largest domestic crude producer

ONGC's E&P segment reported offshore revenue of Rs 22,898 crore and onshore revenue of Rs 10,042 crore for H1 FY26, per their quarterly results. As India's largest domestic crude oil producer, every sustained dollar increase in Brent directly lifts ONGC's net realization. While the company also has a refining and marketing segment (Rs 136,440 crore in H1 FY26 revenue), its upstream E&P business — the pure beneficiary of higher crude prices — is the core profit driver.

What retail investors should do

Don't panic-sell into a one-day crash. Instead, think about duration. If the US-Iran escalation is a brief flare-up, the market will recover in days and the companies above will see minimal lasting impact. But if it turns into a sustained conflict that keeps Brent above $90, here's what changes:

1. Avoid pure consumers with no pricing power. IndiGo can pass some costs to passengers, but only slowly. MRPL, already loss-making, has almost no buffer.
2. Watch the paints sector carefully. Indigo Paints and peers already raised prices 12% this year. Another round of hikes could slow demand in a price-sensitive market.
3. Upstream producers benefit, but check valuations. Oil India and ONGC are direct beneficiaries, but their stock prices tend to already price in oil moves within days.
4. Track the one-month lag. IndiGo's fuel costs won't reflect this spike until August. The real earnings impact shows up in Q2 FY27 results, not Q1.

The market fell 1,677 points in a day, but the real story plays out over quarters, not sessions. Read the filings, not just the headlines.

Data sourced from company filings on NSE via Xaro.