Sector Update: Energy Stocks Fall Late Afternoon
Energy stocks were lower late Monday afternoon, with the NYSE Energy Sector Index and the State Street Energy Select Sector SPDR ETF (XLE) each falling about 3.2%.The Philadelphia Oil Service Sector Index was down 3%, and the Dow Jones US Utilities Index rose 1%.Front-month West Texas Intermediate crude oil fell 4.2% to $81.36 a barrel, and the global benchmark Brent crude contract dropped 4.2% to $83.69 a barrel. Henry Hub natural gas futures rose 1.1% to $3.16 per 1 million BTU.In sector news, a US-Iran peace framework that includes the expected reopening of the Strait of Hormuz has lifted sentiment, but it will take time for oil supply to improve meaningfully, Rystad Energy said in a note emailed Monday. Washington and Tehran have agreed to end their war that has rattled energy markets. The Strait of Hormuz -- the world's most important chokepoint for crude flows -- has remained effectively closed since the US-Israel war with Iran began at the end of February. A formal signing of the US-Iran deal is scheduled to take place in Switzerland on Friday.In corporate news, Shell's (SHEL) Sprng Energy Indian renewable power business could be acquired by Aditya Birla Group, which has emerged as the frontrunner for the unit, Bloomberg reported. Shell shares were falling 3.3%.The European Commission said it has approved a joint venture between TotalEnergies (TTE) and Masdar focused on renewable energy projects in the Asia-Pacific region. TotalEnergies shares were shedding 4.1%.DTE Energy (DTE) received a $1.6 billion loan from the Department of Energy's Office of Energy Dominance Financing to help lower energy costs in Michigan and modernize natural gas infrastructure, the Department of Energy said. Shares rose 0.8%.Peabody Energy (BTU) said Monday it terminated its amended 2020 transaction support agreement with surety providers and entered into standard indemnification agreements to support its US mine reclamation obligations. Shares were down 4.8%.