Energy sector drops over 1% as trade war hits oil stocks
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The news: Oil stocks weighed on the energy sector as fears mounted that an emerging trade war between the US and China will hamper growth in crude demand and lead to a glut later this year.
The numbers: Energy, down 1.3% by 2:30pm AEDT, was the worst performing sector as the ASX 200 index traded roughly flat.
Oil and gas majors Beach Energy (-4.7%), Karoon Energy (-4.1%), Ampol (-1.1%), Santos (-0.9%) and Woodside Energy (-0.8%) were all trading lower.
Beach Energy's first-half result drew a mixed response from analysts but received a ratings downgrade to 'hold' from Morgans.
Brent crude was down more than 3% for the week at around USD74 ($117.7) a barrel, according to Bloomberg data. West Texas Intermediate was below USD71.
The context: Oil is heading for a third weekly decline, having seesawed on a flurry of tariff announcements out of the US and China this week.
Benchmark prices surged on Monday after Trump announced 25% sanctions on Canada and Mexico, the two largest foreign suppliers of crude to the US.
They then tumbled after Trump agreed to delay the measures by a month, and extended losses as a trade war between US and China looked set to escalate.
The source: Bloomberg
