Oil and Natural Gas Corporation (ONGC) has declared an interim dividend of ₹5 per share (or 100 per cent of face value of ₹5 per share) to its shareholders. The ONGC board approved this decision at a meeting held on Monday.

“The board emphasised on the need for a close look at the emerging scenario and advised (the management) to adopt a balanced approach towards capital spending,” a company statement said.

Commenting on the uncertainty in the global oil markets, it said: “During the last few days, due to a sudden and sharp decline in crude oil prices, the share prices of oil sector entities have witnessed a lot of volatility, and particularly the share prices of the upstream companies have been hit hard.”

“In addition, due to the failure of talks of OPEC+ to arrive at an agreement on production cut, oil prices declined drastically. Key oil producers have since adopted a strategy of ‘Fight to Finish’ and have, besides announcing an increase in production, also offered huge discounts to Asian markets, making capturing of markets a key priority at this juncture,” the statement said.

Reflecting confidence in its crude oil off-take and recovery in prices, ONGC said: “All these major developments bring in some uncertainty for the oil and gas sector and specifically for oil and gas producing companies. While the decline in oil prices has affected the off-take of the exporting upstream companies, the companies operating in net importing countries like India have no such issues relating to off-take. Global oil markets are regulated by fundamentals and the prices cannot sustain at such levels for long, as being witnessed today.”

Brent crude traded 10 per cent lower, close to $30.42 a barrel, on Monday.

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