Five oil exploration firms fell by 0.82% to 3.81% at 12:00 IST on BSE after crude oil prices slumped yesterday, 5 January 2015.
Meanwhile, the BSE Sensex was down 560.92 points, or 2.01%, to 27,281.40.
Among oil exploration firms, ONGC (down 3.81%), GAIL (India) (down 2.45%), Cairn India (down 3.16%), Reliance Industries (RIL) (down 2.82%) and Oil India (down 0.82%) dropped.
Fall in crude oil prices would result in lower realizations from crude sales for oil exploration firms.
Brent crude futures edged higher after a steep slide yesterday, 5 January 2015. Brent for February settlement was up 22 cents at $53.33 a barrel. The contract had lost $3.31 a barrel or 5.9% to settle at $53.11 a barrel yesterday, 5 January 2015, its lowest settlement since 1 May 2009, amid speculation rising global output will exacerbate oil supply glut.
Meanwhile, recent fall in crude oil prices could result into reduced subsidy burden for state run oil exploration firms. ONGC, GAIL (India) and Oil India share a part of the under recoveries of state-run oil marketing companies (PSU OMCs) on sale of petroleum products by allowing discount in the prices of crude oil, PSD kerosene, and domestic LPG based on the rates of discount communicated by the Ministry of Petroleum and Natural Gas and the Petroleum Planning and Analysis Cell.
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