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Oil’s tumble to a four-year low has turned airlines and crude-importing nations into the stock market’s biggest winners while sending energy companies to the lowest levels since 2009.
Qantas Airways Ltd. surged 7 percent in Australia and Cathay Pacific Airways Ltd. headed for its largest advance in five years in Hong Kong Kong. BHP Billiton Ltd., Australia’s biggest oil producer, sank 3.4 percent and China’s Cnooc Ltd. slumped 5.3 percent as the MSCI Asia Pacific Energy Index slid to the lowest level since July 2009. The broader regional stock index slipped 0.1 percent.
“It’s all about the oil price,” said David Cassidy, a Sydney-based equity strategist at UBS AG.
Crude tumbled after the Organization of Petroleum Exporting Countries kept its production ceiling steady at yesterday’s meeting in Vienna, resisting calls from Venezuela to cut output. The collapse in prices is dictating winners and losers across national stock markets, with benchmark indexes in oil importers such as China and India rising more than 1 percent today, while those in exporters including Malaysia fell.
Air carriers and shippers accounted for eight of the 10 biggest gains on the MSCI Asia Pacific Index as of 1:23 p.m. in Tokyo, while energy producers made up 8 of the 10 steepest drops.
West Texas Intermediate crude was down 6.6 percent from its Nov. 26 close, trading at $68.82 a barrel, its lowest level since May 2010.
Ali Al-Naimi, Saudi Arabia’s oil minister, confirmed that no action had been taken on output after the meeting of the 12 OPEC members. The group considered a production cut of 5 percent, according to Iraqi Oil Minister Adel Abdul Mahdi.
The transport sector in China, the world’s largest oil importer, will benefit most as a 1 percent drop in crude equates to $2.2 billion in savings and boosts profit by 0.2 percent, Citigroup Inc. said in a report.
China Shipping Container Lines Co. jumped 6.5 percent today while Air China Ltd. added 6.3 percent, set for the biggest increase in a year. The Shanghai Composite Index added 1.5 percent to the highest level since August 2011. Cnooc, China’s largest offshore energy explorer, tumbled 5.2 percent.
“Oil is the key driver for the markets today,” Ryan Huang, a strategist at IG Ltd. in Singapore, said by phone. “Cheaper oil prices will be good for the economy in the long run.”
–With assistance from Jonathan Burgos in Singapore.
To contact the reporters on this story: Kana Nishizawa in Hong Kong at email@example.com; Adam Haigh in Sydney at firstname.lastname@example.org. To contact the editors responsible for this story: Michael Patterson at email@example.com.