S&P/ASX 200 Index (ASX: XJO) oil shares are battling through a dramatic week of mergers, rumoured asset purchases, and rocky oil prices.
Of the three largest ASX 200 oil shares, only one is posting a gain for the week so far. While another has crashed a whopping 6%.
Let's take a look at the week that's been for some of Australia's biggest oil companies.
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ASX 200 oil shares' week so far
Oil price and ASX 200 oil shares slid as OPEC+ lifted production
The week started out tough for ASX 200 oil shares.
On Sunday the Organization of Petroleum Exporting Countries and Russia (OPEC+) announced it will be increasing its production of oil.
It will be producing an extra 400,000 barrels of oil a day every month beginning in August.
The increase in production will see the 6 million barrels of oil currently being withheld every day back on the market by September 2022.
Following the news, oil prices dipped by as much as 8% on Tuesday and they haven't yet recovered.
ASX 200 oil shares are, in turn, feeling the pressure.
Oil Search's rejection of Santos' merger offer
Perhaps the biggest news from the ASX energy sector this week came from Santos Ltd (ASX: STO).
On Tuesday, Santos declared Oil Search Ltd (ASX: OSH) had rejected a confidential merger offer late last month.
The merger would have seen Oil Search shareholders given 0.589 shares in Santos for each Oil Search share held. The implied value represents a 12.3% premium on the Oil Search share price as of 24 June 2021.
The Oil Search share price is posting a gain this week, despite dipping 4.9% on Monday. Shares in Oil Search have gained 10% since news of the rejection broke.
In comparison, the Santos share price has been the worst hit ASX 200 oil share so far this week. It's fallen 6% this week so far.
Woodside to buy BHP assets?
Finally, word on the street today is Woodside Petroleum Limited (ASX: WPL) might be in discussions to buy oil assets from BHP Group Ltd (ASX: BHP).
Yesterday, The Australian reported on rumours that Woodside is in the running to buy either BHP's Australian oil assets or its US$15 billion international assets.
The Woodside share price has fallen 4% since Monday.
