Various industries will be affected by the movement of the Rata Samudra route

New Delhi: Due to the Israel-Hamas war, traffic through the night sea will have an impact on various sectors. For India's oil and gas, the bulk of crude and LNG comes through the Persian Gulf, so the Rata Sea issues will not hamper that flow much. However, the flow of Russian oil from the Black Sea could be affected and the impact could be seen, said academic circles.

This volatility could also lead to higher premiums for Middle East crude. Overall, refiners and oil companies that import crude may be affected, but the impact is unlikely to be major unless the issues are prolonged.

For standalone refiners such as Reliance, MRPL and CPCL, margins may take a hit on the cud side, while on the production side, exports to the EU may be affected. Reliance takes the bulk of Russian crude and also exports large quantities to Europe and South America. However, it is very difficult to quantify the effect due to trade-off adjustments.

Brent is mostly around $80. Hence no material impact is seen at present, although deterioration in conditions and delay in resolution may change this.

For export oriented companies like Bajaj Auto, TVS etc. the freight cost may increase marginally. No major impact on Procter Gamble. Shipment delays may not have such a severe impact during a chip shortage crisis because channel inventories are generally higher than normal, and demand is also reasonably subdued.

Increase in shipping cost in chemical sector will affect Procter Gamble to a certain extent. This will particularly affect companies exporting to Europe, but demand itself is relatively low, so not much affected.

Local logistics players are not affected in the logistics sector. Railway operators may see a marginal impact as the topline will see an increase, but there will be no improvement in overall operating profit as the cement sector will not see any material impact as petcoke is not imported through this route.