One of the worst performing areas of the Australian share market on Friday has been the energy sector.
Investors have been selling off energy shares in a hurry this morning following a sharp decline in oil prices overnight. This has led to the S&P/ASX 200 Energy index falling 2.5% in early trade.
Why did oil prices crash lower?
According to Bloomberg, the WTI crude oil price sank 5.2% to US$58.20 a barrel and the Brent crude oil price tumbled 4.3% lower to US$70.83 a barrel.
This was caused by a number of factors including the release of underwhelming U.S. manufacturing data, easing tensions in the Middle East, and concerns over a prolonged trade war between the United States and China.
Tyche Capital Advisors commodity fund manager, Tariq Zahir, told Bloomberg: "It seems like we're going to be entrenched in a trade war, which is really going to hurt demand for crude oil."
This view was echoed by Gene McGillian, the vice-president of research at Tradition Energy in Stamford, Connecticut. He said: "If we don't have strong enough demand growth, the market's telling us we can't justify oil in the mid-60s."
Here's the state of play in the energy sector at the time of writing:
The Beach Energy Ltd (ASX: BPT) share price is down 4% to $1.96.
The BHP Group Ltd (ASX: BHP) share price has fallen 0.4% to $37.17.
The Cooper Energy Ltd (ASX: COE) share price is 4.5% lower to 54 cents.
The FAR Ltd (ASX: FAR) share price has fallen over 3% to 5.9 cents.
The Oil Search Limited (ASX: OSH) share price has dropped 2.5% to $7.39.
The Origin Energy Ltd (ASX: ORG) share price is off 2.5% to $7.53.
The Santos Ltd (ASX: STO) share price is down 3.5% to $6.96.
The Woodside Petroleum Limited (ASX: WPL) share price has dropped 3% to $35.88.
