Oil Turns Sharply Lower, Drags Energy ETF And Broader Stock Market Down

By Mark DeCambre Markets MarketWatch Pulse

Oil prices retreated sharply lower Wednesday, pushing energy-related shares into negative territory and cutting the market's modest early climb. West Texas Intermediate crude futures for July delivery traded more than 4% lower at $46.02 a barrel, after a report showed an expected climb in U.S. production to record levels. The Energy Information Administration reported that crude-oil inventories climbed by 3.3 million barrels last week, larger than analysts' expectations. The report, which comes as the Organization of the Petroleum Exporting Countries, and other non-OPEC crude producers, are trying to rebalance global supply and stabilize volatile oil prices. The energy sector, as measured through the exchange traded Energy Select Sector SPDR ETF , was down 1.3% in late-morning trade, representing the worst decline among the S&P 500's 11 sectors. The Dow Jones Industrial Average and the S&P 500 initially turned negative following the report, but reduced more modest gains to trade near break-even levels. The S&P 500 was flat at 2,430, the Dow was also tepidly higher at 21,147, up less than 0.1%, while the Nasdaq Composite Index showed a gain of 0.3% at 6,290.

Continue Reading Below

Copyright © 2017 MarketWatch, Inc.