- The energy sector (-4.5%) paces the opening decline, as WTI crude oil prices -4% at $38.35/bbl following a 2.7% slide on Friday after OPEC's failure to agree on a production target to reduce the oil glut.
- Investors are betting on oil prices staying lower for even longer after OPEC's non-decision, pushing U.S. crude futures for delivery nearly 10 years away below $60/bbl, Reuters reports.
- But the oil glut is set to continue as much because of the U.S. as of OPEC, as U.S. shale drillers have only trimmed their pumping a little, and rising oil flows from the Gulf of Mexico are propping up U.S. production; the overall output of U.S. crude fell just 0.2% in September, the most recent monthly federal data available, and is down less than 3%, to 9.3M bbl/day, from the peak in April.
- Goldman Sachs says it expects oil prices to remain "lower for longer," with a risk that prices could fall as low as $20/bbl.
- In early trading: XOM -2.9%, CVX -4.1%, BP -3.2%, RDS.A -4.2%, COP -4.6%, MPC -3.2%, MRO -7.4%, PSX -2.8%, HES -4.9%, APC -6.1%, OXY -3.1%, EOG -5.8%, DVN -9.3%, PXD -7.2%, APA -3.9%, CHK -8%, CLR -9.1%.
- ETFs: USO, OIL, XLE, UCO, UWTI, VDE, ERX, OIH, SCO, XOP, BNO, DBO, OTC:DWTI, ERY, FCG, DIG, GASL, DTO, DUG, BGR, USL, XES, IYE, IEO, IEZ, DNO, FENY, PXE, PXI, PXJ, FIF, OLO, SZO, NDP, RYE, FXN, OLEM, DDG