Oil ETFs Brush Off OPEC Output Promises

The Organization of Petroleum Exporting Countries renewed an agreement to diminish supplies in an attempt to put a dent into the global oil glut, but the pledge was not enough for oil exchange traded fund traders.

On Thursday, the United States Oil Fund (NYSEArca: USO), which tracks West Texas Intermediate crude oil futures, plunged 4.3% and the United States Brent Oil Fund (NYSEArca: BNO), which tracks Brent crude oil futures, plummeted 3.9%.

Meanwhile, WTI crude oil futures declined 4.4% to $49.1 per barrel and Brent crude decreased 4.1% to $51.8 per barrel.

The Energy Select Sector SPDR (NYSEArca: XLE), the largest ETF dedicated to energy equities, was also among the worst S&P 500 sector ETFs Thursday, falling off 1.8% on slipping oil prices.

OPEC renewed an agreement with a dozen other crude-oil producers to withhold supplies into March 2018 in an attempt to raise prices despite increasing output from U.S. shale oil producers, the Wall Street Journal reports. The agreement would maintain levels of production at about 1.8 million barrels per day lower than late last year, or about 2% of global oil supply being withheld.