When the cost of oil was circling around the $150 a barrel mark, it’s little surprise that CPO’s who hadn’t adopted a hedging strategy were sweating nervously.

Now, after oil fell below the $120 a barrel mark in Tuesday trading, the same procurement organisations will have a warm glow of satisfaction – the soaking palms and sleepless nights will have been transferred to those that jumped in to secure long-term pricing deals when the market was at its peak.

At the present time, most companies – particularly those in the aviation industry – are unlikely to be adversely effected if prices stay at their current level. Volatility, however, is still very much a watchword in the oil markets, and if the cost of crude continues to fall then there could be more casualties on oil’s battlefield as the year draws to a close.

Speaking of airlines in the US aviation industry, Brian Nelson, equity analyst at Morningstar told Reuters earlier this week that: “Given some of the hedging mechanisms they are using, they are going to be subject to significant losses on those portfolios. We've never seen such volatility on oil prices.

"They're going to see significant losses if crude oil continues to fall."

It’s a scenario that looked unlikely just a matter of weeks ago, but merely serves to illustrate procurement’s increasingly precarious position.