Indian shares slide as Reliance, ONGC crash on fuel export dutiesReliance Industries and ONGC shares were hammered on Friday after the government imposed export taxes on petrol, diesel and a windfall tax on domestic crude oil to boost internal supplies.India introduced a windfall tax on oil producers that had profited from increased global crude prices and introduced export duties for petrol, diesel, and jet fuel, sending energy stocks into a tailspin.The Nifty Energy index fell 3.7 per cent in its sharpest drop since mid-May.Reuters reported that oil-to-retail giant Reliance Industries Limited (RIL), India’s most valuable company, shed $19.35 billion in market value as its stock plunged as much as 8.7 per cent, marking its biggest intraday slide since November 2, 2020.RIL stock was last trading over 6 per cent lower at Rs 2,436 per share, with the market capitalisation standing at Rs 16.5 lakh crore, on the BSE index.State-owned oil producer ONGC plummeted 12.3 per cent – its biggest slide since pandemic-wrecked March 23, 2020. Oil India slid nearly 11 per cent, while Mangalore Refinery and Petrochemical slumped 10 per cent.The government slapped a Rs 6 per litre tax on export of petrol and ATF and Rs 13 per litre tax on export of diesel, finance ministry notifications showed. Additionally, it levied a Rs 23,250 per tonne additional tax on crude oil produced domestically.The levy on crude, which follows record earnings by state-owned Oil and Natural Gas Corporation (ONGC) and Oil India Ltd (OIL) and private sector Cairn Oil & Gas of Vedanta Ltd, alone will fetch the government Rs 67,425 crore annually on 29 million tonnes of crude oil produced domestically.The export tax follows oil refiners particularly Reliance Industries and Rosneft-backed Nayara Energy making a killing in exporting fuel to deficit regions such as Europe and the US in the aftermath of Russia’s invasion of Ukraine.The restriction on export is aimed at shoring up domestic supplies at petrol pumps, some of which had dried up in states like Madhya Pradesh, Rajasthan and Gujarat as private refiners preferred exporting fuel than selling locally.”Reliance is witnessing a sharp fall after the government levied taxes on windfall gains made by domestic refineries. Earlier, Reliance was firing on all cylinders but now there is a break in its refinery business as the commodity cycle is also reversing, however other verticals have strong growth potential,” Santosh Meena, Head of Research at Swastika Investmart, told Reuters.Separately, gold-related stocks fell on news the government has increased the import tax on the precious metal to 12.5 per cent from the current 7.5 per cent, to ease the pressure on the rupee, which has breached several key-psychological levels, including the 79 per dollar rate.The rupee on Friday hit another all-time low rate of 79.11 against the dollar, marking a series of all-time weak levels in the last few weeks.Jewellery makers Titan Company and Tribhovandas Bhimji Zaveri slipped 6 per cent and 4.1 per cent, respectively.Asian stocks broadly started the new quarter on a weak note, with Indian equity benchmark bourses opening in the red.
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