Oil stocks rose to the highest in two weeks as the price of crude oil soared amidst supply concerns following an attack on a tanker in the Red Sea that led to the rerouting of some tankers and shipments.
The Dow Jones, NASDAQ, and S&P 500 were all higher.
Valero Energy's (VLO) stock price was among the top in leading gains on the S&P 500, along with Marathon Petroleum(MPC) and Diamondback Energy(FANG).
Nucor(NUE) and other steel manufacturers also rose after Nippon Steel agreed to buy U.S. Steel(X) in a $14.9 billion deal. Stocks of U.S. Steel also soared to new heights.
Costco Wholesale(COST) shares also advanced for the second straight session after announcing a special dividend and reporting better-than-expected results.
Rising oil prices had a negative impact on the shares of United Airlines(UAL) and other carriers. VF Corporation(VFC) shares also dipped as the owner of the North Face and Vans brands indicated a cyber attack was likely to have a “material impact” on business operations.
West Texas Intermediate advanced 1.5% and settled above $72/barrel at the highest since December 4. The prices spike as much as 4%. BP PLC said it will pause all shipments navigating through the Red Sea. Equinor AVA is also diverting shipments and vessels away from the region. Euronav NV, a major shipowner is also diverting its ships from the Red Sea, citing safety concerns.
Rebecca Babin, a senior energy trader at CIBC Private Wealth said, “Approximately 8% to 10% of global crude flows through the Red Sea — most to Russia India, and China — which on a face value is not insignificant.”
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Key Takeaways
- Oil industry stocks advanced from a rise in oil prices amid supply concerns after an attack on a supply tanker in the Red Sea.
- Shares of Steel providers soared after Nippon Steel bought U.S. Steel in a $14.9 billion deal.
- VF Corporation’s shares fell after it warned that a cyber attack would likely have a significant impact on its operations.
Source: Trading View
