It's been a shaky day for the S&P/ASX 200 Index (ASX: XJO) so far this Tuesday. After initially rising this morning, the ASX 200 has since dipped into negative territory before making a tentative recovery, currently up by 0.05%. But let's talk about the Woodside Energy Group Ltd (ASX: WDS) share price.
Woodside shares are conspicuously doing far worse than the broader market today. While the ASX 200 is flirting with breakeven territory, Woodside shares are presently down a nasty 1.36% at $37.74 each. That's after the ASX 200 energy share closed at $38.26 a share yesterday and opened at $38.17 this morning.
So why are Woodside shares faring so much worse than the broader market so far today?
What's up with the Woodside Energy share price today?
Well, we have had some news out of Woodside today. In a press release put out this morning, the company revealed that it has signed a non-binding memorandum of understanding with three Japanese companies. This will "enable studies of a potential carbon, capture and storage (CCS) value chain between Japan and Australia".
Sumitomo Corporation, Toho Gas Co Ltd. and Kawasaki Kisen Kaisha are the Japanese companies that have signed up. Together with Woodside, these four companies will study the capture, storage and transportation of carbon dioxide emissions in the Chubu region of Japan. Woodside will also conduct the study of injection and storage of carbon dioxide at Australian storage sites.
Woodside executive vice president Shaun Gregory stated the following on this news:
Woodside sees CCS as an opportunity, which will require coordination and collaboration – between jurisdictions, across government and between government and industry… CCS has the potential to provide a pathway for industry in the region to decarbonise…
Japan is one such country that faces the challenge of emissions reduction and will foreseeably look to near-neighbour nations to support their efforts.
So perhaps this news from Woodside is causing some investor angst on the ASX today.
But what is most likely behind the Woodside share price's woes is the movements of the oil price itself.
Oil price puts a dampener on ASX energy shares
As my Fool colleague James reported this morning, crude oil had a soft night overnight on international markets. West Texas Intermediate (WTI) crude oil price lost 0.25% last night, putting it at US$87.28 a barrel. The Brent crude oil price was also down 0.1% to US$90.59 a barrel.
As an ASX 200 energy share, Woodside's profits are heavily dependent on the global oil price. As such, a drop like this has the potential to dampen investor sentiment for oil stocks, which could be what is happening with the Woodside share price this Tuesday.
That would also explain why we are seeing similar share price falls amongst other ASX 200 energy shares, such as Santos Ltd (ASX: STO), Karoon Energy Ltd (ASX: KAR) and Beach Energy Ltd (ASX: BPT).
Even so, the Woodside share price has still had a pretty pleasant time of it in recent months. Even after today's falls, the company remains up more than 10% over the past six months, and up 14.5% since this time last year:
At current pricing, Woodside shares are trading with a trailing dividend yield of 9%.
