Shares of oil marketing companies fell on Friday after crude oil prices spiked due to heightening geopolitical tensions in the Middle East after US airstrike killed Iranian General Qasseem Soleimani.

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The Pentagon said that the airstrike, that killed Soleimani at Baghdad’s international airport on Friday, "was aimed at deterring future Iranian attack plans."

Shares of Bharat Petroleum Corporation Ltd (BPCL), Hindustan Petroleum Corporation Ltd (HPCL) and Indian Oil Corporation Ltd (IOC) were trading 2.20 percent, 2.10 percent and 0.30 percent lower, respectively at around 10 am.

However, IOC recovered slightly and was trading 0.16 percent higher at 11:25 am. BPCL was trading lower by 1.17 percent while HPCL was down 1.89 percent at around 11:30 am.

The rise in crude oil prices affects the gross refining margins of the oil marketing companies.

Brent crude futures jumped to their highest since September after the US airstrike, which raised concerns that escalating Middle East tensions may disrupt oil supplies.

Brent crude futures jumped 3 percent to hit $68.24 a barrel, while the US West Texas Intermediate crude futures rose 2.86 percent, to $62.90 a barrel.

Meanwhile, oil prices were also lifted by China's central bank saying on Wednesday it was cutting the amount of cash that banks must hold in reserve, releasing around 800 billion yuan ($115 billion) in funds to shore up the slowing economy.

First Published:Jan 3, 2020 11:32 AM IST