Open Interest and Volume Dynamics
On 4 Feb 2026, Oil India’s open interest (OI) in futures and options contracts rose sharply by 3,666 contracts, an 18.24% increase from the previous day’s 20,094 to 23,760. This notable expansion in OI accompanied a total traded volume of 47,089 contracts, indicating heightened speculative and hedging activity. The futures segment alone accounted for a value of approximately ₹42,116 lakhs, while options contracts contributed a staggering ₹30,685 crores in notional value, underscoring the derivatives market’s growing focus on this mid-cap oil sector player.
The total combined derivatives value stood at ₹51,457 lakhs, reflecting substantial liquidity and interest. The underlying stock price closed at ₹511, having touched an intraday high of ₹524, marking a 7.18% rally on the day. This price action was supported by the stock trading above all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – signalling a strong bullish trend across multiple time horizons.
Market Positioning and Directional Bets
The surge in open interest alongside rising prices typically suggests fresh long positions being established, indicating bullish sentiment among traders. The stock’s consecutive gains over two sessions, delivering a 5.75% return, further reinforce this positive momentum. However, the weighted average price data reveals that a significant portion of volume traded closer to the day’s low, hinting at some profit-booking or cautious positioning near the highs.
Interestingly, despite the price rally and volume spike, delivery volumes have sharply declined by 77.18% compared to the five-day average, with only 15.09 lakh shares delivered on 3 Feb. This divergence suggests that while short-term traders and derivatives players are actively positioning, long-term investor participation remains subdued, possibly reflecting profit-taking or a wait-and-watch stance amid volatile oil sector dynamics.
Comparative Performance and Sector Context
Oil India outperformed its sector by 2.75% on the day, with a 1-day return of 4.69% compared to the oil sector’s 1.79% and the broader Sensex’s marginal 0.11% gain. This relative strength highlights the stock’s appeal amid a mixed energy market backdrop, where global crude prices and domestic policy developments continue to influence investor sentiment.
With a market capitalisation of ₹83,396 crores, Oil India remains a mid-cap heavyweight within the oil industry, holding a Mojo Score of 54.0 and a Mojo Grade upgraded to Hold from Sell as of 28 Jan 2026. This upgrade reflects improved fundamentals and technical outlook, although the stock’s Market Cap Grade remains modest at 2, indicating room for growth and volatility considerations.
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Technical Indicators and Moving Averages
Oil India’s price action above all major moving averages signals a robust uptrend. The 5-day and 20-day averages have been steadily rising, confirming short-term momentum, while the 50-day, 100-day, and 200-day averages provide strong medium- and long-term support levels. This technical alignment often attracts momentum traders and institutional investors seeking confirmation of sustained strength.
However, the sharp fall in delivery volumes suggests that while traders are active in the derivatives market, long-term holders may be cautious, possibly awaiting confirmation of sustained earnings growth or global oil price stability before committing fresh capital.
Implications for Investors and Traders
The surge in open interest combined with rising prices and volume indicates that market participants are positioning for further upside in Oil India. This could be driven by expectations of improved operational performance, favourable crude price trends, or government policy support for the oil sector. However, the mixed signals from delivery volumes and volume-weighted average price caution investors to monitor for potential short-term volatility or profit-taking.
Given the stock’s upgraded Mojo Grade to Hold and a moderate Mojo Score, investors should weigh the bullish technical signals against fundamental factors and sector risks. The stock’s liquidity, with a trade size capacity of approximately ₹9.82 crores based on 2% of the five-day average traded value, supports active trading strategies but also requires careful risk management.
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Outlook and Conclusion
Oil India Ltd.’s recent open interest surge and price breakout to a new 52-week high reflect a positive shift in market sentiment. The derivatives market activity suggests that traders are increasingly bullish, anticipating further gains. Nevertheless, the decline in delivery volumes and volume-weighted price patterns indicate some caution among long-term investors, highlighting the need for a balanced approach.
Investors should continue to monitor global crude oil trends, domestic policy developments, and quarterly earnings to validate the sustainability of this rally. The stock’s upgraded Mojo Grade to Hold and mid-cap status make it an attractive candidate for selective accumulation, particularly for those with a medium-term investment horizon and a tolerance for sector volatility.
Overall, the combination of technical strength, improving market positioning, and active derivatives participation positions Oil India as a key stock to watch in the oil sector for 2026.
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