Shares of state-run oil marketing companies today surged with Indian Oil Corp gaining 2.2 per cent, Bharat Petroleum Corp 3.5 per cent and Hindustan Petroleum Corp 3.9 per cent.
Analysts expect no subsidy share for upstream oil marketing companies.
Motilal Oswal says it is confident about the nil subsidy sharing for upstream and downstream companies, thereby limiting their FY15 burden.
The brokerage expects the subsidy problem size to reduce significantly and estimate the gross under-recovery to fall by 80 per cent in FY16.
A fall in crude prices provides further upside, traders said.
Crude oil fell more than 1 per cent on Tuesday ahead of weekly US crude inventory data.