Oil E&P stocks slide alongside drop in global crude oil prices

Stocks of four companies involved in oil exploration & production activities fell 2.22% to 4.05% at 10:00 IST on BSE as global crude oil prices dropped post referendum results suggesting a vote for Brexit.

Meanwhile, the S&P BSE Sensex was off 901.14 points or 3.34% at 26,101.08 dropping along with carnage in world financial markets after results of Brexit referendum vote suggested Britain's exit from the European Union.

Cairn India (down 4.05%), ONGC (down 3.9%), Oil India (down 2.22%) and Reliance Industries (RIL) (down 3.33%) dropped.

Lower crude oil prices will result in lower realization from crude oil sales for oil exploration & production (E&P) firms.

Britain has voted to leave the European Union based on voter tallies from today's 24 June 2016, referendum, an outcome that would set the country on an uncertain path and deal the largest setback to European efforts to forge greater unity since World War Two.

World financial markets dived as counting from 304 of 382 areas showed a 51.5/48.5 split for leaving. Quitting the EU could cost Britain access to the EU's trade barrier-free single market and mean it must seek new trade accords with countries around the world. Risk assets were scorched as investors fled to the safety of top-rated government debt. The currencies collapsed with British Pound Sterling and Euro witnessing a free fall against the dollar.

Crude oil futures also witnessed selling pressure after Britain chose to leave European Union. Brent for August 2016 settlement was currently off $2.80 per barrel at $48.11 a barrel. The Brent August contract had risen $1.03 a barrel or 2.06% to settle at $50.91 a barrel yesterday, 23 June 2016.

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