Why Oil Stocks Are Getting Crushed Today
Oil prices sold off on Thursday, plunging nearly 8% on the day. That shellacking sent most oil stocks tumbling. Leading the downdraft were Chesapeake Energy (NYSE: CHK), Denbury Resources (NYSE: DNR), Parsley Energy (NYSE: PE), WPX Energy (NYSE: WPX), and Callon Petroleum (NYSE: CPE), each of which fell at least 10% by 2:30 p.m. EDT on Thursday.
In addition to slumping crude prices, disappointing earnings reports in the sector also weighed on oil stocks.
Oil prices, along with the broader stock market, fell off a cliff after President Donald Trump tweeted that he would impose new tariffs on Chinese goods starting next month. That fueled worries of an escalating trade war between the two countries, which could cause a global economic slowdown. Given that recessions typically sap oil demand, crude prices tumbled on worries that consumption growth will slow.
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