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EIA Expects Record Oil & Liquid Exports in '24: 3 Stocks to Gain
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The West Texas Intermediate (WTI) crude oil price is once again nearing the $75 per barrel threshold and is expected to stay robust into the coming year. Specifically, the U.S. Energy Information Administration (“EIA”) anticipates a WTI oil price of $78.07 per barrel in 2024, slightly surpassing its projected figure of $77.63 for the current year. Contributing to the strength of commodity prices are additional voluntary production cuts implemented by several OPEC countries.
Although there has been a slowdown in drilling activities, handsome oil prices may provide incentives to explorers and producers to produce more of the commodity. Increasing liquid production will thus, in turn, increase net exports of the U.S. petroleum and other liquids. The EIA anticipates that net exports of crude oil and petroleum products from the domestic market will achieve a record peak of nearly 2 million barrels per day (Bbl/D) in 2024. This projection indicates a rise from 1.8 million Bbl/D in the current year and 1.2 million Bbl/D in 2022.
Therefore, it is an opportune moment for investors to monitor prominent upstream companies that will continue contributing to oil production in the United States in the coming year and beyond.
EOG Resources is a leading oil and natural gas exploration and production company, capitalizing on handsome crude prices. It has many undrilled premium locations in prolific shale resources comprising the Permian Basin and Eagle Ford Shale play, resulting in a brightened production outlook.
The leading upstream energy player, with a Zacks Rank of 2 at present, is strongly committed to returning capital to shareholders. Since transitioning to premium drilling, the company has returned a handsome amount of cash to stockholders. Moreover, with the employment of premium drilling, EOG can reduce its cash operating costs per barrel of oil equivalent, aiding its bottom line.
Matador Resources has a strong presence in the oil-rich core acres of the Wolfcamp and Bone Spring plays in the Delaware Basin. Promising oil prices are likely to aid it in increasing production volumes.
The company acquired Advance Energy Partners Holdings, LLC, in the largest deal in its two-decade history. MTDR, carrying a Zacks Rank #3 at present, expects the buyout to be accretive to important valuation and financial metrics since the deal involves a strategic bolt-on of 18,500 net acres in the core of the Northern Delaware Basin, a sub-basin of the prolific Permian Basin.
Diamondback Energy, a leading pure-play Permian operator, has reported ongoing enhancements in the average productivity per well in the Midland Basin throughout 2023. Thus, the #3 Ranked company may continue to witness increased production volumes. FANG also has an investment-grade balance sheet.
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EIA Expects Record Oil & Liquid Exports in '24: 3 Stocks to Gain
The West Texas Intermediate (WTI) crude oil price is once again nearing the $75 per barrel threshold and is expected to stay robust into the coming year. Specifically, the U.S. Energy Information Administration (“EIA”) anticipates a WTI oil price of $78.07 per barrel in 2024, slightly surpassing its projected figure of $77.63 for the current year. Contributing to the strength of commodity prices are additional voluntary production cuts implemented by several OPEC countries.
Although there has been a slowdown in drilling activities, handsome oil prices may provide incentives to explorers and producers to produce more of the commodity. Increasing liquid production will thus, in turn, increase net exports of the U.S. petroleum and other liquids. The EIA anticipates that net exports of crude oil and petroleum products from the domestic market will achieve a record peak of nearly 2 million barrels per day (Bbl/D) in 2024. This projection indicates a rise from 1.8 million Bbl/D in the current year and 1.2 million Bbl/D in 2022.
Therefore, it is an opportune moment for investors to monitor prominent upstream companies that will continue contributing to oil production in the United States in the coming year and beyond.
Employing our Stock Screener, we have identified three stocks – EOG Resources, Inc. (EOG - Free Report) , Matador Resources Company (MTDR - Free Report) and Diamondback Energy, Inc. (FANG - Free Report) . While one carries a Zacks Rank #2 (Buy), the remaining two have a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
3 Stocks in Focus
EOG Resources is a leading oil and natural gas exploration and production company, capitalizing on handsome crude prices. It has many undrilled premium locations in prolific shale resources comprising the Permian Basin and Eagle Ford Shale play, resulting in a brightened production outlook.
The leading upstream energy player, with a Zacks Rank of 2 at present, is strongly committed to returning capital to shareholders. Since transitioning to premium drilling, the company has returned a handsome amount of cash to stockholders. Moreover, with the employment of premium drilling, EOG can reduce its cash operating costs per barrel of oil equivalent, aiding its bottom line.
Matador Resources has a strong presence in the oil-rich core acres of the Wolfcamp and Bone Spring plays in the Delaware Basin. Promising oil prices are likely to aid it in increasing production volumes.
The company acquired Advance Energy Partners Holdings, LLC, in the largest deal in its two-decade history. MTDR, carrying a Zacks Rank #3 at present, expects the buyout to be accretive to important valuation and financial metrics since the deal involves a strategic bolt-on of 18,500 net acres in the core of the Northern Delaware Basin, a sub-basin of the prolific Permian Basin.
Diamondback Energy, a leading pure-play Permian operator, has reported ongoing enhancements in the average productivity per well in the Midland Basin throughout 2023. Thus, the #3 Ranked company may continue to witness increased production volumes. FANG also has an investment-grade balance sheet.