On a slippery curve

▶ Oil & Gas companies reported a sharp YOY jump in revenue and net profit in Q1FY22 due to higher crude oil prices and sales volume, but both the numbers were down sequentially

▶ Higher oil and gas prices meant higher margins for upstream companies like ONGC, but it hit margins of downstream oil refiners like Indian Oil Corporation

▶ Diversified major, Reliance Industries (RIL) benefitted from a global surge in the price and demand for petrochemicals products as developed economies opened but RIL’S retail business was hit by the second wave

▶ RIL'S telecom business, on the other hand, delivered both YOY and sequential growth in revenue and earnings but growth seems to be tapering

▶ City gas distributor Indraprastha Gas suffered from a loss in demand due to the second wave, leading to sequential decline in revenue and profit

▶ Going forward, gas companies are expected to do better than oil producers and refiners