Omicron rattles oil prices; 3 ASX energy shares to watch out for

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Omicron rattles oil prices; 3 ASX energy shares to watch out for

 Omicron rattles oil prices; 3 ASX energy shares to watch out for
Image source: Standret,Shutterstock

Highlights

  • Oil prices fell US$10 on Friday as Omicron threatened the Australian economic recovery.
  • Australian energy stocks fell 4.6% on Friday.
  • Traders sold in panic on fears that Omicron has the potential to put countries back into lockdown mode and hurt the travel market.

Oil prices fell US$10 on Friday, their largest one-day dip since April 2020, as a new COVID-19 vaccine-resistant variant of coronavirus – Omicron – threatened the Australian economic recovery and raised concerns that a supply surplus could swell in the first quarter. Australian energy stocks, particularly, fell 4.6% on Friday, their biggest dip since September 2020.

Traders sold in panic on fears that Omicron has the potential to put countries back into lockdown mode and hurt the travel market. While brent crude ended down 11.6%, to US$72.72 a barrel, a weekly decline of over 8%, US West Texas Intermediate (WTI) crude settled 13.1% down, at US$68.15 a barrel, falling over 10.4%.

Meanwhile, the US last week had announced the plan to release 50 million barrels of oil from the Strategic Petroleum Reserve to curb rising fuel prices. China, India, Japan, South Korea, and the UK were also planning to release some of their reserves.

In such a scenario, investors and traders would be closely tracking a few big names in the Australian energy sector. These stocks have fallen as much as 3% in the last five trading sessions.

Oil Search Ltd (ASX:OSH)

In the last five days, shares of Oil Search have fallen 2.92%. Other than the concerns over rising prices, investors are also concerned about reports claiming that the company’s former CFO is suing the firm on allegations of bullying, intimidation, and harassment. Meanwhile, the stock has given a year-to-date (YTD) return of nearly 6%. In the past one year, the stock rose over 9%.

Santos Ltd (ASX:STO)

In the last five days, shares of Santos have fallen 0.3%. Santos share price is under pressure despite its mega-merger with fellow ASX 200 energy share Oil Search Ltd inching closer. Meanwhile, the stock has given a year-to-date (YTD) return of nearly 1%. In the past one year, the stock rose over 5%.

Woodside Petroleum Ltd (ASX:WPL)

In the last five days, shares of Woodside Petroleum were unchanged. The company had recently announced a merger with BHP Group’s oil assets and its Scarborough project. The two companies have signed a binding share sale agreement. In addition, Woodside has made a final investment decision for the Scarborough project and Pluto Train 2 development.

Meanwhile, the stock has given a negative year-to-date (YTD) return of over 6%. In the past one year, the stock fell over 3%.

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