Shares in Asia-Pacific slipped in Monday trade, as oil prices fell after OPEC and its allies reached a deal.
The Nikkei 225 in Japan dropped 1.46% in afternoon trade while the Topix index shed 1.39%. South Korea’s Kospi fell 0.91%.
In Hong Kong, the Hang Seng index slipped 1.59% by the afternoon. Mainland Chinese stocks also declined, with the Shanghai composite down about 0.3% while the Shenzhen component dipped fractionally.
Australian stocks also declined as the S&P/ASX 200 dropped 0.85%.
MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.19%.
Oil prices fall after OPEC+ deal
In the afternoon of Asia trading hours on Monday, international benchmark Brent crude futures slipped 1.06% to $72.81 per barrel. U.S. crude futures also declined 1.09% to $71.03 per barrel.
Shares of oil firms in Asia-Pacific also declined in Monday trade, with Santos in Australia falling 2.56%. Japan’s Index dropped 2.1%, while Japan Petroleum Exploration plunged 2.56%. CNOOC shares in Hong Kong slipped 1.35%.
OPEC and its allies reached a deal on Sunday to phase out 5.8 million barrels per day of oil production cuts by September 2022. Coordinated increases in oil supply from the group — collectively known as OPEC+ — will start in August, OPEC said in a statement.
The development came as Brent surged more than 40% so far in 2021, with demand for crude rising as the global economy recovers from the pandemic.
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 92.726 following a recent climb from below 92.4.
The Japanese yen traded at 109.94 per dollar, stronger than levels above 110.4 seen against the greenback last week. The Australian dollar changed hands at $0.7387, lower than levels above $0.748 last week.