Energy companies drop on oil price rout
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The news: Energy sector stocks are leading losses on the ASX 200, tracking a decline in oil prices in anticipation of the OPEC+ cartel agreeing to ramp up supply when it meets tomorrow.
The numbers: The energy sector was the worst performing sector in morning trade, down 1.08% at 11:30am AEST.
The 13 largest companies by market cap were all lower, including Woodside (-1.3%), Santos (-1%), Yancoal (-1.2%), and Ampol (-0.8%).
Brent Crude Oil was down 0.5% to USD63.85/barrel while WTI Crude Oil was down 0.4% to USD60.68 a barrel.
The context: The faster-than-expected reinitiation of idle output capacity by OPEC — which accounts for about 40% of global oil supply — is creating oversupply fears.
OPEC+, which includes non-OPEC member oil producers, agreed on Wednesday to establish a mechanism for setting baseline oil production for 2027 and will hold talks on Saturday which could accelerate output for July.
