Oil stocks are in the red today on news that the Organization of the Petroleum Exporting Countries (OPEC+) producers have been forced to delay a meeting on production cuts, with some pointing to potential global crude supply issues.
The OPEC+ summit has been moved to Nov. 30, from its previous Nov. 25-26 timeline. It’s unclear exactly why the organization opted to push back the date of the meeting, but oil stocks are clearly being penalized for it.
Indeed, Exxon (NYSE:XOM) is down about 0.85% at the time of writing. Meanwhile, Chevron (NYSE:CVX) and Hess (NYSE:HES) are each down about 0.3%. Today’s big loser is APA Corp (NASDAQ:APA), parent of Apache, which is down about 1% currently.
Why Are Oil Stocks Down Today?
If you recall, the members of OPEC+ have been artificially limiting oil output in order to raise crude prices. It’s speculated that the member countries of OPEC will make even more cuts at its now-delayed meeting. Oil prices have dropped nearly 20% since its 2023 peak just months ago.
At the time of writing, West Texas Intermediate (WTI), the U.S. standard crude benchmark, is currently down 1.21%. That is actually an improvement from earlier in the day, when WTI dropped more than 4%. WTI is currently selling for about $77 per barrel, well below it’s roughly $94 high back in September.
Brent crude is also down about 1% today, trading for $82 a barrel, down from its own $94 September peak.
While members of OPEC+ may be disappointed by the reduction in oil prices, U.S. drivers have clearly been benefitting from the change. Indeed, U.S. gasoline prices are currently trending around $3.28 a gallon, with 11 states enjoying average gas prices below $3. This is a significant improvement from just one month ago, when the average was $3.55 for a gallon of regular gas.
On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
