ConocoPhillips Stock Falls as Oil Prices Retreat

ConocoPhillips (NYSE:COP) shares are sliding Wednesday along with other oil and gas exploration and production companies as crude prices retreat from a two-day rally, pressured by easing Saudi supply concerns and a smaller-than-expected drawdown in U.S. crude inventories. ConocoPhillips stock is among today’s weakest performers. What’s weighing on COP shares? Oil Prices Fall as Saudi Arabia Eases Supply Concerns Benchmark crude prices gave back a chunk of their recent gains Wednesday. Brent slid 3.3% to settle near $105.12 a barrel, and WTI dropped 3.9% to around $101.72, according to Reuters. Behind the move, people familiar with the matter said Saudi Arabia has started routing extra crude to buyers in Asia by transferring it ship-to-ship near Oman’s Sohar port. That workaround takes some sting out of the disruption caused by recent attacks on the pipeline connecting the country’s east to its Red Sea coast. That relief followed a sharp rally the day before. Reports that Saudi Arabia had paused loadings at its Yanbu export terminal and scrapped some European shipments had pushed oil up more than $3. Yanbu took on outsized importance for Saudi exports after Iran moved to block the Strait of Hormuz earlier this year in response to American and Israeli military action, a corridor that under normal circumstances handles roughly one-fifth of global oil and gas trade. Ship traffic through that strait has stayed unusually light. Only four vessels were spotted passing through Tuesday, down from seven the previous day and far below the recent 10-day average of 18. Rising U.S. Inventories Add to Pressure on Crude Crude took another hit after the Energy Information Administration disclosed that domestic stockpiles dropped by roughly 640,000 barrels last week. That’s a much smaller decline than the 1.62 million barrels economists surveyed by Reuters had anticipated. Both gasoline and distillate supplies climbed during that same stretch. Diesel supplies built up by more than analysts had projected, even as gasoline had been expected to shrink instead. Again Capital’s John Kilduff called the report a negative signal for prices. He pointed out that finished fuel supplies look steady to slightly higher, even as the pace of crude drawdowns has largely stalled. COP Shares Are Slipping COP Price Action: ConocoPhillips shares were down 4.69% at $134.60 at the time of publication on Wednesday, according to Benzinga Pro. Read Also: Saudi Pipeline Closure Is ‘Temporary Interruption,’ Says Energy Secretary—Expert Warns, ‘It Will Take Months to Repair’ Image: Shutterstock