This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Falling Oil Prices Could Pressure Energy Stocks Lower

NEW YORK (TheStreet) -- U.S. energy stocks continue to lag the broader market as oil prices rapidly decline.

The Energy Select Sector SPDR (XLE) has underperformed the SPDR S&P 500 (SPY)  since June, the last time Brent crude oil prices were greater than $115.

The energy ETF is most heavily weighted by Exxon Mobil(XOM) , Chevron (CVX) , Schlumberger (SLB) , ConocoPhillips (COP)  and EOG Resources (EOG) .

Brent crude oil prices are sliding toward two-year lows as geopolitical concerns have slightly diminished and more supply enters the market.

On Monday, Kurdish forces took over the Mosul Dam, Iraq's largest dam, from Islamic State militants. The Kurdish forces received air support from the U.S. and reversed gains made by the Sunni-Muslim insurgents in the north via the capture of the dam.

Iraq is the second-largest oil producer in the Organization of Petroleum Exporting Countries, and conflict in the region has been a major factor in the dramatic rise of the price Brent crude oil over the past few months.

Analysts say that the Kurd's ability to capture the dam is an indicator of growing strength that will help them take back the oil fields as well.

Falling geopolitical risks this week also come alongside increased production in Libya. Libya's production had been disrupted for months by strikes and protests, but showed an increase to 535,000 barrels per day on Sunday. The acceleration was above previous reports, but still far below the 1.4 million bpd pumped last year.

Collectively, however, increased supply and decreasing risks in Iraq have pressured Brent crude oil prices to yearly lows, and prices could fall to less than $100 for the first time since last July if the trend continues.

Courtesy of

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
SPY $209.32 0.00%
XLE $68.26 0.00%
AAPL $118.03 0.00%
FB $105.41 0.00%
GOOG $748.15 0.00%


Chart of I:DJI
DOW 17,813.39 +1.20 0.01%
S&P 500 2,088.87 -0.27 -0.01%
NASDAQ 5,116.1430 +13.3350 0.26%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs