Energy Stocks Underperform As Oil Slips Below $84 (USO, UNG, XOM, CVX, MRO, SU)
Shares of oil companies continued to trade lower on Friday as jobs report from the U.S. raised question on the demand of the oil.
The benchmark U.S. July contract for light, sweet crude oil slumped $3 or -3.39% to $86.60 in electronic trading on the New York Mercantile Exchange. On Thursday, crude futures were down $1.29, or 1.5%, to $86.53 a barrel, marking the lowest settlement in the past 7 months.
The contract is on the way to post a loss of over 17% for the month, its worst monthly performance since December 2008.
As per the report, The U.S. added just 69,000 jobs in May, the least net increase in nonfarm payrolls a year, the government reported. Economists were estimating a 165,000 rise. Growth figures in payrolls were also revised lower for April and March.
May’s unemployment rate, meanwhile, rose to 8.2% from 8.1%, mainly because more people entered the labor force even as hiring slowed.
Other energy related commodities also hammered down, July gasoline fell lost 6 cents, or 2.16%, to $2.66 a gallon and July heating oil fell 5 cents, or 2%, to $2.65 a gallon on their first full trading day as front-month contracts.
July natural gas slumped -3.43% at $2.32 per million British thermal units.
United States Oil Fund LP (ETF)(NYSEARCA:USO) plunged 3.70% to $31.41 and United States Natural Gas Fund, LP(NYSEARCA:UNG) lost 3.75% to $16.16.
Exxon Mobil Corporation(NYSE:XOM) fell 0.74% to $78.05. The company has applied for federal permits to expand plastics production at two Texas plants, citing the low cost of U.S. natural gas.
Marathon Oil Corporation(NYSE:MRO) lost 3.30% to $24.09, Chevron Corporation(NYSE:CVX) fell 2% to $96.32 and Suncor Energy Inc. (USA)(NYSE:SU) slumped 3% to $26.19.