The plunging oil price was felt on the ASX today with the benchmark ASX 200 index losing 0.62% to 7,029, extending its decline in afternoon trade weighed down by Energy and Materials sectors.
News that OPEC+ had decided to postpone its planned meeting this weekend led to the drop in oil prices, along with US data pointing to another rise in stockpiles. The OPEC+ postponement is said to be linked to Saudi Arabia’s dissatisfaction over the production levels of other members.
Capital Com senior financial market analyst Kyle Rodda said: “The prospect of volatility in the coming weeks has been heightened by OPEC+’s decision to delay its meeting until the end of next week, ostensibly as critical players take issue with who shoulders future output cuts and how they are implemented.
“Prices took a spill after US Crude Inventory data revealed a much larger than expected build for the week, although the move was mostly unwound, likely on the view that signs of oversupply will only galvanise OPEC+ to act.”
The global benchmark Brent sank below $US81 a barrel after a volatile session on Wednesday in which prices swung by more than $4, while West Texas Intermediate was trading around US$76 a barrel.
The slump in oil prices was felt locally with energy majors Santos ending down 1.54%, Woodside Energy Group losing 1.58% and Beach Energy (ASX:BPT) finishing 1.95% lower.
As for Materials, the sector’s 1.56% drop today comes amid an almost 7% rise over the past month. BHP (ASX:BHP) dropped 1.8%, Fortescue (ASX:FMG) lost 2% and Rio Tinto (ASX:RIO) fell 1.4%.
However, it wasn’t all bad news today on the local market — Telcos, Tech stocks, Real Estate and Utilities all finished out ahead.
Origin Energy came out of a trading halt to announce it has deferred the shareholder vote on its proposed acquisition by a Brookfield-led consortium of investors from this afternoon to December 4. The delay is due to the company receiving a complex new bid.
Nick Scali recovered much of its day's losses to end 1.4% lower, following news that its CEO and managing director Anthony Scali sold $50 million worth of shares (4.6 million shares), a decision made “to diversify the family's assets”.
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