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3 Energy Picks as Oil Price Hits the Highest Since Late-April
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Despite persistent macroeconomic headwinds affecting the broader energy sector, investor sentiment regarding the oil market is bullish. Oil price remains solid, with further upside possibly awaiting as crude consumption across the globe is expected to increase. Considering the landscape, energy players like Oceaneering International, Inc. (OII - Free Report) , Ecopetrol S.A. (EC - Free Report) and Battalion Oil Corporation (BATL - Free Report) are well-poised to gain.
High Oil Price
West Texas Intermediate oil recently touched the highest mark since late April and is currently trading at more than the $76 per barrel mark. Brent crude is trading at more than $81 per barrel, also representing an extremely healthy pricing environment. An upbeat world oil demand outlook, a weaker U.S. dollar and a continued supply cut from OPEC+ aided the prices.
In its latest monthly oil market report, the Organization of the Petroleum Exporting Countries (“OPEC”) disclosed that it has revised higher its forecast for the growth in global oil market demand for 2023 to 2.44 thousand barrels per day (mb/d) from the prior estimate of 2.35 mb/d. The monthly report also revealed that next year, oil consumption will likely get boosted, thanks to improved expectations for impressive economic growth across the globe.
The International Energy Agency, in its latest monthly report, revealed that global oil demand will reach 102.1 mb/d this year, suggesting growth of 2.2 mb/d. Thus, higher commodity consumption amid tightening supply indicates that crude price will remain favorable in the coming days.
3 Stocks in the Spotlight
Given the backdrop, it can be concluded that investors should allocate money to stocks of the companies whose operations are directly correlated with oil prices and are capable of capitalizing on the favorable business landscape. Employing our proprietary stock screener, we have zeroed in on three stocks sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Oceaneering International is well placed on improving oil prices since it is a leading provider of engineered services and products and robotic solutions to the energy companies working offshore. Higher oil price is supporting increased upstream activities, which, in turn, will improve demand for Oceaneering’s drilling and completions support services.
Ecopetrol is a well-known integrated energy player in the American continent, with Permian – the most prolific basin in the United States – being a prominent growth driver. Ecopetrol is responsible for as high as 60% of hydrocarbon production in Colombia and thus is well-positioned to derive more cashflows from improving oil prices.
Battalion Oil is also a highly prospective stock to gain on healthy oil prices since it is engaged in exploring, producing and developing liquid-rich resources in the prolific Delaware Basin. Battalion Oil is a pure-play Delaware operator with a deep inventory of high-return locations, securing a solid production outlook.
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3 Energy Picks as Oil Price Hits the Highest Since Late-April
Despite persistent macroeconomic headwinds affecting the broader energy sector, investor sentiment regarding the oil market is bullish. Oil price remains solid, with further upside possibly awaiting as crude consumption across the globe is expected to increase. Considering the landscape, energy players like Oceaneering International, Inc. (OII - Free Report) , Ecopetrol S.A. (EC - Free Report) and Battalion Oil Corporation (BATL - Free Report) are well-poised to gain.
High Oil Price
West Texas Intermediate oil recently touched the highest mark since late April and is currently trading at more than the $76 per barrel mark. Brent crude is trading at more than $81 per barrel, also representing an extremely healthy pricing environment. An upbeat world oil demand outlook, a weaker U.S. dollar and a continued supply cut from OPEC+ aided the prices.
In its latest monthly oil market report, the Organization of the Petroleum Exporting Countries (“OPEC”) disclosed that it has revised higher its forecast for the growth in global oil market demand for 2023 to 2.44 thousand barrels per day (mb/d) from the prior estimate of 2.35 mb/d. The monthly report also revealed that next year, oil consumption will likely get boosted, thanks to improved expectations for impressive economic growth across the globe.
The International Energy Agency, in its latest monthly report, revealed that global oil demand will reach 102.1 mb/d this year, suggesting growth of 2.2 mb/d. Thus, higher commodity consumption amid tightening supply indicates that crude price will remain favorable in the coming days.
3 Stocks in the Spotlight
Given the backdrop, it can be concluded that investors should allocate money to stocks of the companies whose operations are directly correlated with oil prices and are capable of capitalizing on the favorable business landscape. Employing our proprietary stock screener, we have zeroed in on three stocks sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Oceaneering International is well placed on improving oil prices since it is a leading provider of engineered services and products and robotic solutions to the energy companies working offshore. Higher oil price is supporting increased upstream activities, which, in turn, will improve demand for Oceaneering’s drilling and completions support services.
Ecopetrol is a well-known integrated energy player in the American continent, with Permian – the most prolific basin in the United States – being a prominent growth driver. Ecopetrol is responsible for as high as 60% of hydrocarbon production in Colombia and thus is well-positioned to derive more cashflows from improving oil prices.
Battalion Oil is also a highly prospective stock to gain on healthy oil prices since it is engaged in exploring, producing and developing liquid-rich resources in the prolific Delaware Basin. Battalion Oil is a pure-play Delaware operator with a deep inventory of high-return locations, securing a solid production outlook.