The S&P/ASX 200 Index is experiencing notable declines today, significantly influenced by the downward movement in energy shares, reflected by the ASX Energy Index (XEJ) having lost 2.89% on the day, continuing the trend that has been in place through 2025. An 18.17% in the XEJ YTD highlights some of the challenges facing individual names in the sector, and has served to pull the ASX 200 back into negative territory on the year, down 0.53%.
Monday’s session snaps a 7 day consecutive run of gains on the ASX 200, with the 1 month increase of 11.09% pushing the index firmly back above $8,100.
This shift is attributed to a marked decrease in Brent crude oil prices, which have fallen by 3.4% to reach US$59.20 per barrel. Such a reduction marks an 11% decrease since last Monday. The decline is largely driven by Saudi Arabia’s surprise announcement to increase oil production by 400,000 barrels per day, effective from June.
Industry experts suggest that Saudi Arabia’s actions aim to enforce discipline and manage output quotas within OPEC+.
Additionally, Russia’s energy representative, Alexander Novak, noted the potential for increased production by other major oil-producing nations including Russia, the UAE, and Kuwait. The broader implications are driven by pressures from the global market, including political influences from the United States. President Donald Trump had previously encouraged OPEC+ to raise production levels to mitigate energy prices.
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Other names to have weighed on the benchmark index today include Westpac Banking Corp, with WBC’s shares having fallen almost 3% on declining profits during 1H25. The other leading banks also fell in sympathy, with CBA (-1.61%), NAB (-1.75%), and ANZ (-0.99%) all ending the opening session of the week in the red.
