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Weekly Oil Markets Recap - Outperformance Comes From Conviction And Patience



  • WTI finished the week higher by 2.38%.
  • Energy stocks are now climbing the leaderboards.
  • Outperformance doesn't come easy, it takes conviction and patience.
  • And ultimately, the big gains are made by those who are right and sit tight.
  • We see more outperformance ahead for the energy sector.

Welcome to the weekly oil markets recap edition of Oil Markets Daily!

WTI finished the week higher by 2.38% and another multi-year high.

Not only is oil regaining multi-year highs, the HFI Portfolio and energy stocks are moving higher as well. As we wrote in a daily this week titled, "Leaderboard Change: Energy Stocks Climbing To The Top." There has been a not so subtle shift in the market leaderboard in April, and energy stocks are now climbing to the top.

Not only has the recent climb put energy stocks (XOP) near the top of the leaderboard, but the outperformance in XOP to the S&P 500 (SPY) has now broken out of the downtrend since late 2014, something we think all investors should keep a close eye on.

But now with energy stocks outperforming the broader market, the relative outperformance didn't come easy. Just 3 months ago, the investment community still didn't believe that oil prices could remain above $60/bbl and energy stocks were cast aside and left dead. The divergence became so large that we published multiple articles to address just how ridiculous the divergence was getting:

And even as we write this weekly oil markets recap, the energy sector as a whole remains undervalued. Most energy names are still pricing in 0% probability of higher oil prices for longer. Conservatively speaking, the energy names we track are

This article was written by

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Leader of HFI Research
The largest oil and natural gas research service on Seeking Alpha.

#1 Energy Research Service on Seeking Alpha


HFI Research specializes in contrarian investment analysis. We help you to find clarity in a world of uncertainty. We take contrarian thinking very seriously and believe that the only way to obtain a real edge in the market is to possess a contrarian investment thesis. We share our investment analysis with premium subscribers through daily and weekly reports.


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Analyst’s Disclosure: I am/we are long CRC, GXE.TO, CVE.TO, OIH, XES. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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