Crude Oil Futures fell to a 11 year low, as tensions between Saudi Arabia and Iran were left behind and investors digested higher inventories.
China one of the big consumers of oil, saw its stock markets shut for trading after one of its indices fell below the 7% mark, promoting authorities to shut trading there.
There are fears that a further slowdown in China could lead to a crash in crude prices to levels under $30 a barrel. The market is oversupplied by almost 1 million barrels of oil. There is a heavy build-up of inventories further adding to the pressure on crude prices.
Meanwhile, shares in India's big producers of oil and gas, ONGC and Cairn India fell sharply, following the drop in crude prices.
Cairn India dropped a huge 7 per cent in trade, while ONGC fell as much as 5 per cent in trade. Analysts would closely watch the results of these corporates for the quarter ending Dec 31, 2015 fir further cues.