Energy stocks ride oil prices higher on potential OPEC production cut
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Energy (NYSEARCA:XLE) is the big leader in Tuesday's S&P 500 sector standings, +3.8% in response to a ramp-up in oil prices on talk that OPEC+ may cut production or at least reduce the rate of its production increase at the group's September 5 meeting.
But Reuters also reported OPEC+ cuts may not be imminent if they would coincide with the return of Iran to oil markets in the event of a nuclear deal with the U.S.
Front-month WTI October crude oil (CL1:COM) +3.4% to $93.50/bbl, and October Brent crude (CO1:COM) +3.1% at $99.47/bbl.
ETFs: (XLE), (COP), (VDE), (OIH), (IEO), (DRIP), (CRAK), (NYSEARCA:USO), (UCO), (SCO), (BNO), (DBO), (USL)
Energy stocks dominate the S&P 500 leaderboard: (HAL) +7.8%, (APA) +7.4%, (OXY) +7.3%, (SLB) +6.3%, (MRO) +6.2%, (FANG) +5.3%, (BKR) +4.7%, (DVN) +4.5%, (HES) +4%, (XOM) +3.9%, (COP) +3.8%, (EOG) +3.6%.
The oil and gas group extends its August gain to ~5%, leading all 11 S&P industry sectors, while the S&P 500 index is up just 0.2% for the month.
Prince Abdulaziz bin Salman told Bloomberg on Monday that OPEC+ has the "commitment, the flexibility and the means" within its agreements to deal with market challenges, including cutting production "at any time and in different forms."
Also, U.S. natural gas prices trade at fresh 14-year highs, reaching as high as $10/MMBtu.
Related: The U.S. average gasoline price has declined for 70 straight days, its longest streak since 2015.