KUALA LUMPUR (March 19): Bursa Malaysia’s Energy Index fell as much as 3.86% to 951.63 this morning as oil and gas (O&G) counters came under selling pressure after oil prices dropped more than 7%.

At 10.12am, the Energy Index had pared some losses at 964.74, still losing 25.62 points or 2.59%.

Reuters said oil prices fell today, extending losses for a sixth day as a new wave of Covid-19 infections washed across Europe, spurring new lockdowns and dampening hopes for a recovery in demand for fuels anytime soon.

US crude fell below US$60 (RM247.29) again and was trading at US$59.97 a barrel by 0115 GMT. Brent crude was off by one cent at US$63.27, it said.

On Bursa, almost all O&G stocks were in the red this morning.

Scomi Group Bhd slid 16.67% or one sen to five sen; Velesto Energy Bhd slipped half a sen or 2.86% to 17 sen; Bumi Armada Bhd shed two sen or 4.35% to 44 sen; Sapura Energy Bhd declined by half a sen or 3.03% to 16 sen; and Barakah Offshore Petroleum Bhd dropped by two sen or 20% to eight sen.

Hengyuan Refinery Company Bhd, among the top 20 losers this morning, tumbled 14 sen or 2.44% to RM5.60.

Rakuten Trade Sdn Bhd head of research Kenny Yee said the selling on oil-related counters today was mainly due to the overnight plunge in crude oil prices.

“I think the downtrend is only short-term as trades are taking the opportunity to lock in profits,” he told theegemarkets.com.

Meanwhile, Hong Leong Investment Bank (HLIB) Research analyst Ng Jun Sheng said in a note today Brent oil prices slumped amid a surge in new Covid-19 cases in Europe and the bloc’s continued challenges in vaccination against Covid-19.

“On the back of the broad-based pullback on Wall Street amid lofty valuations and an uncomfortable spike in the 10-year Treasury [yields], coupled with fresh worries about the third Covid-19 wave in Europe caused by mutating virus and a lack of vaccines, market sentiment may be dampened today, particularly for technology and O&G related stocks, following overnight slides in the Nasdaq and crude oil prices,” he added.