The gross refining margins (GRMs) of Reliance Industries Ltd will be adversely impacted by $6-7 per barrel, while ONGC and Oil India could see their earnings for 2022-23 getting affected by 36 per cent and 24 per cent, respectively, by the fussilade of oil levies last week.

According to Morgan Stanley Research, the higher cess on domestic crude production of $40 per barrel on ONGC and Oil India was a negative surprise and should imply downside risks for the sector.

Its analysts reportedly added that export taxes, restrictions and windfall taxes on oil producers are a global trend and it shows the tightening energy market outlook.

The finance ministry has maintained that the cess will have no adverse impact on domestic petroleum products or fuel prices.

Further, small producers, whose annual production of crude in the preceding financial year is less than 2 million barrels will be exempt from this cess.

An Edelweiss report said that the additional excise duty of Rs 23,250 per tonne on domestic crude oil production amid surging prices would translate to post-tax impact of54 per cent on the consolidated earnings of ONGC for the current financial year.

Its analysts said the cess could be reduced once the crude oil prices fall.

The brokerage has slashed the average realisation of ONGC in the current fiscal to $65 per barrel from $90 per barrel. Though experts feel it will be affected by the fresh duties, it continues to receive a buy rating.

BofA Global Research said GRM of Reliance will be negatively impacted by $6-7 a barrel, though the overall impact would be based on how long these restrictions last.