NRGU - Energy leads all sectors lower weighed by Exxon's downbeat Q2 outlook
2023-07-06 17:50:59 ET
Energy ( NYSEARCA: XLE ) was the stock market's biggest sector loser Thursday, -2.2% , as all 11 S&P groups finished in the red, with crude oil finishing flat after a choppy session in which traders coped with mixed signals, including a price hike for Saudi crudes and broader risk-off sentiment.
Saudi Aramco raised prices for its benchmark Arab light crude by $0.80/bbl for buyers in Europe, $0.10/bbl for buyers in North America, $0.20/bbl in Asia and $1.00/bbl in the Mediterranean.
The price changes mean buyers in the U.S and other parts of North America will pay a $7.25/bbl premium for Saudi crude over the Argus Sour Crude Index, buyers in Asia will pay an extra $3.20/bbl over the average of the Oman and Dubai oil price benchmarks, while European buyers will pay a $3.80 premium and Mediterranean buyers will pay a $3.50 premium over Brent prices.
The Saudis started the week by rolling over the production cut it launched in July, and Russia lowered its output by 500K bbl/day.
Meanwhile, the Energy Information Administration reported U.S. commercial crude inventories fell by 1.5M barrels for the week ended June 30, the third straight weekly decline in domestic stockpiles.
WTI crude touched a two-week high early before slipping back below its 50-day moving average $71.34/bbl, with the front-month August contract ( CL1:COM ) settling at $71.80/bbl, while September Brent crude ( CO1:COM ) closed -0.2% at $76.52.
ETFs: ( NYSEARCA: USO ), ( BNO ), ( UCO ), ( SCO ), ( DBO ), ( USL ), ( DRIP ), ( GUSH ), ( USOI ), ( NRGU )
The sector was weighed by weak leadership from Exxon Mobil ( NYSE: XOM ), which finished -3.7% for its worst close since mid-March after its business update showed lower natural gas prices and lower refining margins, setting the stage for soft Q2 results.
Other large losers included Antero Resources ( AR ) -4.6% , Range Resources ( RRC ) -4.3% , ConocoPhillips ( COP ) -3.5% , Hess ( HES ) -3.2% , Southwestern Energy ( SWN ) -3.2% .
The oil and gas sector is down ~10% YTD after today's loss, sitting at the bottom of this year's leaderboard.
More on oil and gas:
- USO: Improving Risk Appetite And Backwardation Point To Strong Total Returns
- Oil Can Still Hit $100 Per Barrel And XLE Investors Can Benefit
- China's Economic Slowdown: A Wake-Up Call For The U.S. Economy
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Energy leads all sectors lower, weighed by Exxon's downbeat Q2 outlook