The Origin Energy Ltd (ASX: ORG) share price is down a significant 4.8% as the electricity retailer, LNG and coal seam gas loses investor support as oil prices hit a 52-week low this week.
The prices of Origin's core LNG product are directly linked to oil prices and as such it's likely to bring in less revenue over any given period on the back of lower oil prices assuming sales volumes remain the same.
As at 11.15am AEST Brent crude futures change hands for US$56.09 and WTI futures for US$46.65, with the oil price plunging in line with equity and other capital markets since late August.
In fact it was only a few months ago that WTI futures sold for above US$70, and the oil price remains remains on a downward slide over the past 5 years from prices above US$100 a barrel at the end of 2014.
Investors in Origin and other oil price taking businesses like Woodside Petroleum Limited (ASX: WPL), Santos Ltd (ASX: STO) and Oil Search Limited (ASX: OSH) might want to consider if the oil price is in structural decline based on rising supply and moderating demand growth in particular from developed markets.
