Crude Oil Prices Decline 20% YTD: RIL, IOC in Fray — Which Stock Should Investors Buy?

Crude oil prices are witnessing a downward trend for the most part of 2025, losing about 20% on a year-to-date (YTD) basis. On May 5, Brent crude fell below the $60/barrel mark.

Though crude oil prices bounced back at $61 level today, May 6, it has fallen by about 10% in the past six sessions. The fall in prices can be attributed to two reasons: rising OPEC supply amid weak demand and US-China trade war.

Vishnu Kant Upadhyay, AVP - Research & Advisory, Master Capital Services said crude oil prices fell by more than 18% in April. This is due to rise in production by key oil producing nations like OPEC cartel and trade disputes globally which hampered oil demand.

Outlook on crude oil prices

On May 3, OPEC+ decided to ramp up the production of oil for the second consecutive month, raising the June output to 411,000 barrels per day (bpd). The eighth participants in the OPEC+ group, which includes allies like Russia, will take the total combined hikes for April, May and June to 960,000 bpd.

ING and Barclays also slashed their Brent crude forecasts. Barclays slashed its Brent forecast by $4 to $66 a barrel for 2025 and by $2 to $60 for 2026. On the other hand, ING expects Brent to touch $65 this year, down from $70 previously, Reuters reported.

Are falling crude oil prices beneficial for India?

Though declining crude oil prices are causing trouble to commodity traders, it could boost the slowing Indian economy and also boost the domestic stock market.

Ross Maxwell, Global Strategy Operations Lead, VT Markets said India imports more than 80% of its crude oil needs. He said that declining crude oil prices is generally good news for the Indian economy, as it reduces the country's import bill and can support the rupee, which encourages foreign investment.

The fall in crude oil prices also helps to reduce inflation as it lowers the cost of fuel and transport costs across a variety of sectors. This in turn increases the profit margin of those companies that heavily rely on crude oil.

Can falling crude oil prices impact the Indian stock market?

Declining crude oil prices is a positive development for the Indian equity markets, as India imports over 80% of its crude oil requirements, said Kunal Kamble, Sr. Technical Research Analyst at Bonanza Group. Cheaper crude prices mean lower transportation and manufacturing costs, which in turn helps to ease CPI inflation.

Stocks to buy amid declining crude oil prices

Investors can look forward to those companies' stocks that are heavily reliant on oil. These include aviation, automotive, paints, oil marketing companies and refineries and FMCG. Let’s have a look at what analysts have to say.

Sumit Pokharna, VP-Fundamental Research, Kotak Securities is betting big on Reliance Industries. RIL is engaged in processing crude oil and sells finished products domestically and also exports them. Declining crude prices are beneficial for refiners. “We believe long-term investors can buy RIL. We are positive on RIL and believe there are multiple triggers for the company to grow,” Pokharan said.

Aamar Deo Singh, Sr VP-Research at Angel One, said declining oil prices help in easing inflation, which helps in bringing down transport and production expenses. “Many industries benefit in such times, such as plastics, adhesives, oil-based paints and dyes, are set to go down as input costs plummet for these companies, leading to higher operating margins for these industries. Also, oil market companies benefit from this decline. In the paint space, Berger Paints looks good. In the adhesive space, Pidilite can be looked at, and in the CV space, Ashok Leyland looks fine,” said Singh.

Kunal Kamble, Sr. Technical Research Analyst at Bonanza Group, recommended buying IGL and Asian Paints. “IGL is showing strong technical strength. The stock has given a breakout from a falling wedge pattern on the daily chart, accompanied by rising volumes—a sign of growing investor interest. Price is trading above the 50-day EMA, and the RSI is trending higher, all of which support the ongoing positive price action,” Kamble said. He added that Asian Paints is another stock showing potential. “While it is currently consolidating in a lower range, the setup indicates readiness for an upside move. The stock remains well-positioned for an uptrend as long as it sustains above ₹2,290,” Kamble added.