Share of state-run oil exploration company ONGC rose as much as 10.26 per cent to hit an intraday high of Rs 101 on the back of sharp rally in crude oil prices. Oil rose on Friday, extending a sharp rally overnight that saw Brent rise above $50 for the first time since March, as coronavirus vaccination rollouts kept hopes alive that demand for crude would build up next year.
Brent was up 11 cents or 0.2 per cent at $50.36 a barrel by 10:00 am, after gaining nearly 3 per cent on Thursday. US oil was up 14 cents, or 0.3 per cent, at $46.92 a barrel, having also risen almost 3 per cent in the previous session.
That leaves prices set for a sixth consecutive week of gains as promising vaccine trials helped quell gloom over record increases in the number of new infections and deaths around the world in the coronavirus pandemic.
Britain began inoculations this week and the United States could start vaccinations as early as the coming weekend, while Canada on Wednesday approved its first vaccine with initial shots due from next week.
“Crude prices are surging in anticipation of the FDA’s potential approval of Pfizer’s vaccine, as Asia’s economic recovery is making Chinese and Indian refiners acquire more oil,” said Edward Moya, senior market analyst at OANDA.
Outside advisers for the U.S. Food and Drug Administration have voted to endorse emergency use of Pfizer’s vaccine, paving the way for the agency to authorise its use to inoculate a nation that has lost more than 285,000 lives to COVID-19.
A big jump in U.S. crude stockpiles served as a reminder that there is still plenty of supply available, but was all but ignored as bulls ran through the market this week.
ONGC shares saw heavy trading volumes as 45.89 lakh shares changed hands on the BSE compared with an average of 30.62 lakh shares traded daily in the past two weeks.
As of 11:51 am, ONGC shares traded 7.59 per cent higher at Rs 98.55, outperforming the Sensex which was up 0.41 per cent.