The Santos Ltd (ASX: STO) share price is in the red today as the price of oil falls and rumours swirl that Santos has attracted buyers for its Dorado project.
Despite ending last week trade trading for US$76.33 per barrel, the price of brent crude oil has slipped to US$70.53 per barrel. The WTI crude oil price hasn’t fared any better. It’s currently US$68.28 per barrel, down from US$73.95.
Additionally, Santos’ Dorado project has reportedly received interest from Mitsui and Mitsubishi.
Right now, the Santos share price is slipping. It’s fallen 1.55% so far today to trade at $6.36 per share.
Let’s take a closer look at what’s driving Santos’ shares lower.
What’s with the Santos share price?
The Santos share price is falling amid reports the company is getting ready to sell part of its share in the Dorado project, located in Western Australia.
According to reporting by The Australian, Mitsui and Mitsubishi are both interested in purchasing 20% of the project. That will see Santos’ holding in Dorado reduced to 60%.
The publication stated Santos’ Van Gogh and Pyrenees projects are also on the table.
Additionally, it said if Santos is successful in taking over Oil Search Ltd (ASX:OSH) it will likely sell more of its assets.
The Santos share price is faltering alongside oil prices. The price of oil has been slipping since OPEC+ pledged to increase oil production in the coming months.
However, that’s likely not the reason for this week’s fall.
According to today’s reporting by Reuters, increased US oil stockpiles and COVID-19’s Delta variant have weighed on the price of oil this week.
The outlet stated China and the US – the world’s biggest oil users – are struggling to contain large outbreaks of Delta. The health challenge has seen demand in the countries wane.
Additionally, the increase to US stockpiles has also slowed global demand for oil.
Santos share price snapshot
It’s likely no surprise the Santos share price has been struggling lately.
It has fallen 11% over the last month alone. Santos’ shares are now trading for about 1% less than they were at the start of 2021. However, they have gained 15% since this time last year.