Reliance's oil-to-chemicals business revenue jumps 30% as crude prices surge
What's the story
Reliance Industries Limited (RIL) has reported a 30.4% year-on-year (YoY) increase in revenue from its oil-to-chemicals (O2C) business for the first quarter of FY27. The segment raked in ₹2.02 lakh crore, driven by a sharp rise in crude oil prices despite lower production due to planned turnaround activities. The company's chairman Mukesh Ambani said, "The O2C business delivered strong performance during the quarter."
Price impact
Average Brent crude price during Q1FY27
The average price of Brent crude oil during Q1FY27 was $104.5 per barrel, an increase of $36.7/bbl compared to the previous year.
The spike is attributed to the closure of the Strait of Hormuz, which disrupted an estimated 13 million barrels per day (bpd) of crude supplies and tightened global oil markets.
EBITDA growth
EBITDA of O2C segment
The EBITDA (earnings before interest, taxes, depreciation, and amortization) of RIL's O2C segment for Q1FY27 stood at ₹17,010 crore. This is a 17.2% increase from the same period last fiscal year.
The growth was primarily driven by a sharp increase in transportation fuel cracks and downstream margins amid challenging global energy market conditions with disrupted supply chains.
Segment performance
Oil and gas segment performance
RIL's oil and gas segment also witnessed a 3.2% YoY increase in revenue, thanks to higher realization on KG D6 oil/condensate and favorable exchange rate movement.
The growth was further supported by increased CBM gas production and realization, although it was partly offset by lower KG D6 gas production and price realization during the same period.