Image source: Getty Images
The Woodside Energy Group Ltd. (ASX:WDS) The stock price spent most of Wednesday in the red following a drop in oil prices.
At the time of writing, shares of energy producer ASX are down 0.09% at $32.01, after hitting an intraday low of $31.73.
Let’s take a look at what’s going on with Woodside and the market.
Woodside shares lose ground as oil price drops
Investors are weighing on Woodside’s stock price as the price of its key commodity comes under selling pressure.
Currently, West Texas Intermediate (WTI) and Brent prices are trading at US$87.10 and US$92.84 per barrel, respectively.
China’s central bank lowered key rates to boost demand as data showed the economy slowed in July. The news shocked the market and likely sent oil prices crashing to a six-month low.
It appears that Beijing’s woes are driven by its strict COVID-19 policy, which has severely affected factory and retail activity. An ongoing real estate crisis in the country has not helped matters.
The S&P/ASX 200 Energy Index (ASX:XEJ) is down 0.31% today, alongside other energy players.
Shares in another energy giant Santos S.A. (ASX: STO) fell 2.12% to $6.93 apiece despite the company’s positive half-year results released today.
What future for the price of oil?
Last week, OPEC released its monthly oil market report predicting that global oil demand growth in 2022 will be slower than expected. The group estimated that oil demand would grow at a healthy rate of 3.1 million barrels per day (mb/d). This is due to expectations of a resurgence of COVID-19 related restrictions and lingering geopolitical uncertainties such as the Russian war in Ukraine.
In total, OPEC expects oil demand to average around 100 mb/d in 2022.
Looking further ahead, forecasts for global oil demand growth in 2023 remain unchanged at 2.7 mb/d, with total oil demand averaging 102.7 mb/d.
Woodside Share Price Summary
Despite a slight decline today, it has been a solid 12 months for Woodside’s stock price, up 54%.
Shares of the company hit a 52-week high of $35.77 in early June on the back of years of high oil prices.
By market cap, Woodside is the largest energy company on the ASX, with a valuation of around $60.78 billion.