Crude oil, Big Oil names surge as OPEC weighs production increase
Jul. 01, 2021 9:25 AM ETEnergy Select Sector SPDR ETF (XLE), USO, XOM, CVXUCO, XLE, IYE, OIH, VDE, COP, BP, XOM, PXE, PXJ, CVX, SHEL, USO, IEO, XOP, BGR, FIF, RYE, DBO, DUG, DIG, FXN, USL, DDG, ERY, ERX, SCO, BNO, OLEM, NDP, FENY, CRAK, GUSH, DRIP, NANR, JHME, OILK, FTXN, USOI, USAI, NRGU, NRGD, NRGO, NRGZ, YGRN, CO1:COM, CL1:COMBy: Carl Surran, SA News Editor98 Comments
- WTI crude oil rockets past $75/bbl for the first time since October 2018 after media reports indicate that Saudi Arabia and Russia have reached a tentative deal to gradually raise production.
- According to Reuters, the OPEC+ group is weighing a plan that would ease production curbs enough to add ~2M bbl/day to the market between August and December, with monthly increases amounting to less than 500K bbl/day.
- A final decision is expected at a meeting of OPEC+ ministers later today, following meetings of OPEC ministers and the Joint Ministerial Monitoring Committee.
- August WTI (CL1:COM) +3.4% to $75.99/bbl, after surging more than 50% during the first six months of the year, while September Brent (CO1:COM) +2.7% to $76.64/bbl.
- ETFs: XLE, USO, UCO, XOP, VDE, GUSH, OIH, ERX, BGR, BNO
- Big oil names are indicated higher in pre-market action: XOM +1.9%, CVX +2.2%, COP +2.9%, BP +2.6%, RDS.A +2.2%.
- "The consensus was looking for 500K bbl/day or slightly more, so 400K bbl/day additions would be below expectations for August and would keep the market tight this summer, with still rising demand over the coming weeks," UBS analyst Giovanni Staunovo says.
- Energy topped the S&P sector leaderboard during H1, but there's cause for caution in H2.