Reliance Hits 52-Week High; Price Could Reach ₹1,785 on Venezuela Oil Development

New Delhi: Shares of Reliance Industries have hit a 52-week high, with the stock touching ₹1,611.20 during trading, amid optimism surrounding developments in Venezuela. Analysts expect the price to rise further to ₹1,785, driven by potential benefits from the recent U.S. action against Venezuela.

The United States has taken strict measures against Venezuela, including the arrest of President Nicolás Maduro. Experts believe that the U.S. may now take control of Venezuela’s oil reserves, which could benefit Indian companies such as Reliance Industries and ONGC.

Jefferies has stated that if sanctions on Venezuela are eased or lifted, both companies could gain from improved crude oil supply, cash flow, and valuation. Venezuela holds nearly 18% of the world’s oil reserves, yet currently contributes less than 1% to global crude supply. With possible U.S.-led investment in Venezuelan oil fields, production could increase by 2027–28. If OPEC+ countries do not offset this increase by reducing production, global crude prices may come under pressure.

Impact on Reliance:
Reliance could gain access to Venezuelan crude at a discounted rate. Its Jamnagar refinery complex is technically capable of processing Venezuela’s heavy, sour, and acidic crude, which very few refineries globally can handle. Historically, Venezuelan crude has traded $5–8 per barrel below Brent crude.

Reliance had a long-term agreement with Venezuela’s state-owned PDVSA since 2012, covering roughly 20% of its daily crude requirements. However, the deal ended in 2019 due to U.S. sanctions. Jefferies believes that with renewed access, Reliance could secure long-term crude supply at favorable rates, boosting its gross refining margin.

Impact on ONGC:
Similarly, ONGC could benefit from its stalled projects in Venezuela. The company has an outstanding dividend of over $500 million from production in the San Cristóbal region. U.S.-led restructuring could allow the company to receive this amount and resume development in the Orinoco Belt, where ONGC holds an 11% stake.

Jefferies has maintained a “Buy” rating for both Reliance and ONGC, setting a target price of ₹1,785 for Reliance and ₹310 for ONGC. This implies a potential upside of 12% for Reliance and 28% for ONGC from their previous closing prices. While Reliance gained today, ONGC shares saw a small decline of around 2% during trading.

Disclaimer: The analysis and suggestions are based on individual analysts’ or brokerage firms’ views. Investors are advised to consult certified experts before making any investment decisions, as market conditions can change rapidly.