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Oil Price Back to the Glory Days: Will XOM, EOG & COP Gain?
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Key Takeaways
WTI crude trades above $90/bbl, up from last year's $65.40, boosting energy sector prospects.
XOM leverages Permian and Guyana assets, raising well recoveries and production potential.
COP and EOG have low breakeven costs in major U.S. basins, positioning them for gains.
The Energy sector is at the forefront now, with the ongoing war in the Middle East driving oil prices back to levels reminiscent of their glory years. Many investors are wondering whether to include or sell oil stocks in their portfolio. Amid the backdrop, investor can keep their eye on energy majors like EOG Resources, Inc. (EOG - Free Report) , Exxon Mobil Corporation (XOM - Free Report) and ConocoPhillips (COP - Free Report) .
Oil Price May Remain High
The price of West Texas Intermediate (WTI) crude is trading at more than $90 per barrel, according to data from oilprice.com, owing to the ongoing war in the Middle East. Also, in its latest short-term energy outlook, the U.S. Energy Information Administration (“EIA”) mentioned its expectation for the WTI oil price this year at $73.61 per barrel, higher than $65.40 last year.
Thus, the present crude pricing environment is highly favorable for exploration and production activities. This will increase demand for drilling rigs and oil field services.
3 Stocks to Gain: XOM, EOG, COP
ExxonMobil has a strong footprint in the Permian, the most prolific oil and gas play in the United States, and offshore Guyana. In the Permian, the integrated giant has been employing lightweight proppant technology and hence has been capable of boosting its well recoveries by up to as much as 20%.
In Guyana, XOM has made several oil and gas discoveries, further highlighting its solid production outlook. Record production from both resources has been aiding its top and bottom lines. In both resources, the breakeven costs are low. With presence in prolific upstream assets, ExxonMobil, carrying a Zacks Rank #3 (Hold), will likely gain from the favorable pricing environment of oil. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
ConocoPhillips has a strong presence in the Lower 48, which comprises the Permian – the most prolific basin in the United States – Eagle Ford and Bakken. The company’s acquisition of Marathon Oil has further bolstered its footprint in the prolific Lower 48.
The breakeven costs in the resources are low, and hence will likely enable #3 Ranked COP to reap the benefit of favorable oil prices.
Among the prolific resources where EOG Resources has a strong footprint are the Delaware Basin and Eagle Ford. The company with a Zacks Rank of 3 has roughly 12 billion barrels of oil equivalent resource across its multi-basin portfolios, and is thus well-positioned to gain from the prevailing crude prices.
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Oil Price Back to the Glory Days: Will XOM, EOG & COP Gain?
Key Takeaways
The Energy sector is at the forefront now, with the ongoing war in the Middle East driving oil prices back to levels reminiscent of their glory years. Many investors are wondering whether to include or sell oil stocks in their portfolio. Amid the backdrop, investor can keep their eye on energy majors like EOG Resources, Inc. (EOG - Free Report) , Exxon Mobil Corporation (XOM - Free Report) and ConocoPhillips (COP - Free Report) .
Oil Price May Remain High
The price of West Texas Intermediate (WTI) crude is trading at more than $90 per barrel, according to data from oilprice.com, owing to the ongoing war in the Middle East. Also, in its latest short-term energy outlook, the U.S. Energy Information Administration (“EIA”) mentioned its expectation for the WTI oil price this year at $73.61 per barrel, higher than $65.40 last year.
Thus, the present crude pricing environment is highly favorable for exploration and production activities. This will increase demand for drilling rigs and oil field services.
3 Stocks to Gain: XOM, EOG, COP
ExxonMobil has a strong footprint in the Permian, the most prolific oil and gas play in the United States, and offshore Guyana. In the Permian, the integrated giant has been employing lightweight proppant technology and hence has been capable of boosting its well recoveries by up to as much as 20%.
In Guyana, XOM has made several oil and gas discoveries, further highlighting its solid production outlook. Record production from both resources has been aiding its top and bottom lines. In both resources, the breakeven costs are low. With presence in prolific upstream assets, ExxonMobil, carrying a Zacks Rank #3 (Hold), will likely gain from the favorable pricing environment of oil. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
ConocoPhillips has a strong presence in the Lower 48, which comprises the Permian – the most prolific basin in the United States – Eagle Ford and Bakken. The company’s acquisition of Marathon Oil has further bolstered its footprint in the prolific Lower 48.
The breakeven costs in the resources are low, and hence will likely enable #3 Ranked COP to reap the benefit of favorable oil prices.
Among the prolific resources where EOG Resources has a strong footprint are the Delaware Basin and Eagle Ford. The company with a Zacks Rank of 3 has roughly 12 billion barrels of oil equivalent resource across its multi-basin portfolios, and is thus well-positioned to gain from the prevailing crude prices.