O&G counters take a beating following crude oil dip

O&G counters take a beating following crude oil dip
-A +A

KUALA LUMPUR (March 9): Oil and gas (O&G) counters took a beating on the local exchange today after crude oil price dipped below US$40 per barrel.

JF Apex Research Bhd analyst Lee Cherng Wee said the O&G counters were weighing on the global oil sentiment.

"The counters' performance is definitely down to the oil prices. I expect the trend to continue for the next few weeks," he told theedgemarkets.com.

At 3.44pm, Petronas Gas Bhd was down 10 sen or 0.45% at RM22.20 with 131,900 shares traded for a market capitalisation of RM44 billion.

Petronas Chemicals Group Bhd fell 11 sen or 1.6% to RM6.75 with 8.4 million shares transacted for a market capitalisation of RM53.68 billion.

UMW Oil & Gas Corp Bhd dipped half a sen or 0.52% to 95.5 sen with 914,800 shares changing hands giving it a market capitalisation of RM2.06 billion

SapuraKencana Petroleum Bhd went down two sen or 0.94% to RM2.10 with 15.03 million shares traded that gave it a market capitalisation of RM12.52 billion.

Uzma slipped three sen or 1.71% to RM1.72 with 83,500 shares transacted for a market capitalisation of RM509.13 million.

Sumatec Resources Bhd declined half a sen or 4.17% to 11.5 sen with 1.15 million shares done for a market capitalisation of RM404.5 million.

MIDF Research analyst Aaron Tan said the O&G counters came under strong profit taking following the slump in crude oil price.

He told theedgemarkets.com that shareholders had enjoyed gains over the past two days when Brent oil rose to US$41 on output slowdown since December last year.

US West Texas Intermediate (WTI) crude futures, meanwhile, went up to US$38.11 per barrel, its highest since early January.

On Tuesday, however, oil prices declined with WTI crude contract settling 3.7% down at US$36.50 a barrel on the New York Mercantile Exchange, while the global Brent contract fell 2.9% to US$39.65.

Fresh signals of global oversupply and weak demand buffeted the market and analysts cautioned that the recent market rally appeared unsustainable, said the Wall Street Journal.