Brent Crude yesterday slipped below $35/barrel, the lowest in 11 years as US supplies showed a 10.6 million-barrel surge in gasoline supplies, the biggest build since 1993. Yesterday, brent futures LCOc1 fell $2.19 to settle at $34.23 a barrel. Earlier, it fell to as low as $34.13, its lowest level since the start of July 2004.

US supplies apart, the North Korean nuclear test and today’s rout in China, all added to the price of crude slipping.

Following this slip in crude prices, oil exploration and production companies are down in the red. Cairn India is amongst the top five losers on the BSE, down at an intra day low of Rs.130.05, a fall of over 7%.

The Q2FY16 performance of the company was as such affected due to the falling crude prices, with its net profit slipping 70%.

During Q2, the company sold oil at an average price of $43.7 a barrel compared with $92.1 a year earlier. The crude decline prompted the oil producer to cut its capital expenditure plans for the year ending March 31 by more than half to $500 million. Now with prices tumbling down much lower, clearly we will see a bigger fall in the Q3 net profit.