Australian Shares Fall as Oil Stocks Rise Amid Middle East Tensions

2 min read | October 04, 2024 10:49 AM AEST | By Team Kalkine Media

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Australian Shares Fall as Oil Stocks Rise Amid Middle East Tensions — Image source: shutterstock

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Highlights

Australian shares dip as oil stocks rise amid Middle East tensions.

Energy stocks gain while most ASX sectors fall, led by mining.

Woodside reports a fatality at its Texas site, investigation underway.

Australian shares opened lower today, with the S&P/ASX down 0.9% to 8133, as 10 out of 11 sectors on the index experienced losses. The mining sector led the decline, dropping 1.5%, while energy stocks gained as global oil prices surged following concerns over potential retaliatory actions by Israel targeting Iran’s oil infrastructure.

The overnight headlines were dominated by rising oil prices after US President Joe Biden confirmed discussions about a possible Israeli retaliation on Iranian oil assets. As a result, Brent crude and the US benchmark, West Texas Intermediate, hit their highest intraday levels in about a month, with futures contracts closing over 5% higher.

Despite the broader market downturn, energy stocks on the ASX saw notable gains. Woodside Energy (ASX:WDS) rose by 2.5%, while Santos (ASX:STO) gained 1.8%. Brazilian oil and gas explorer Karoon Energy (ASX:KAR) also climbed 3.7%, trading at $1.67.

While energy stocks provided some relief, the rest of the market continued to struggle. On Wall Street, the Dow Jones dropped 0.4%, the S&P 500 fell 0.2%, and the Nasdaq remained relatively flat.

In focus today was a tragic update from Woodside Energy (ASX:WDS), which reported a fatality at its Beaumont Clean Ammonia site in Texas. Details of the incident remain unclear, but the company confirmed that operations at the site had been suspended pending an investigation.

Elsewhere, Regal Partners (ASX:RPL) announced that it now manages over $17 billion in funds as its takeover discussions with Platinum Asset Management progress. The two firms have entered the due diligence phase this week, with Regal’s shares inching up 0.3% to $3.49.

Infratil’s (ASX:IFT) CDC data centre business saw a $287 million increase in value over the past three months, boosted by sector excitement following a record $24 billion buyout of competitor AirTrunk. Infratil’s 48% stake in CDC is now valued at $4.8 billion, up from $4.15 billion just three months ago. Despite this positive news, Infratil’s shares slipped 0.5% to $11.02.

The broader Australian market remains under pressure, with concerns around global geopolitical tensions affecting investor sentiment, while energy stocks continue to benefit from rising oil prices.

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