Oil and gas stocks maintain torrid pace, up 5% this week and 18% YTD

SlavkoSereda/iStock via Getty Images

Energy stocks (NYSEARCA:XLE) ticked lower Friday but again topped the S&P sector leaderboard for the week, +5.1%, as crude oil futures settled at fresh seven-year highs and natural gas exploded +23% in a wild end-of-the-week burst.

Oil and gas stocks are on pace to post their best month since February 2021, as the S&P 500 Energy Index is up 18.2% so far this year.

The front-month WTI contract (CL1:COM) added 2% on the week to settle at $86.82/bbl after trading as high as $88.84, the highest intraday level since October 2014, while natural gas futures (NG1:COM) jumped 8.3% to end the week at $4.64/MMBtu.

Crude prices have gained ~15% YTD on supply worries as geopolitical tensions rise between Russia - the world's second largest oil producer and a key natural gas provider to Europe - and the West over Ukraine, as well as threats to the United Arab Emirates from Yemen's Houthi movement.

Attention also will turn to next week's meeting of OPEC and its allies, which includes Russia; the cartel is seen as likely to stick with a planned rise in its oil output target for March.

"OPEC+ production has been gradually increasing, but still not enough to keep up with demand," and if Russia invades Ukraine, "there is certainly some upside for oil, because not only could sanctions factor in, but theoretically their position in OPEC+ would be threatened too," Global X analyst Rohan Reddy told Bloomberg.

The week's top 5 gainers in energy and natural resources: EXTN +69%, INDO +56.8%, TDW +24.5%, NEX +18.7%, AR +15.6%.

The week's top 5 decliners in energy and natural resources: GATO -70.3%, ETRN -21.1%, EQX -19.6%, USAU -17.3%, HMY -16.6%.

Source: Barchart.com

Comments

[Sharpe Ratio]

NG1 over $5 today.

[Et20]

First cut your own supply,
Then give all the power to OPEC.
Now try to start a war with Russia.

Next they will blame consumers for this "torrid" mess because you emit too much gas and didn't transition to wind and autonomous EV fast enough.

[oportunity]

@Et20 When was supply cut? B/c shale, along with the past administration is actually to blame. Shale companies: poor capital management, oversupplying the market, and with it price destruction, and then that little thing called covid. Past administration: requested production increase from OPEC which was provided, and from there it was a race to the bottom. Covid was the surprise left hook that knocked the industry on its a**. I still place the lion's share of the blame on the shale companies.

Russia should be put in check. They should never have been allowed to get away with their previous incursion in the Crimea, and I agree with Biden's approach. Keep Russian oil flowing, but use force instead. I would like to see a very large coalition force. That would put Putin in his place.

There won't be any war if NATO mobilizes. There is no appetite for it in Russia, this is a bluff, and it's a damned shame if NATO doesn't act. Ukraine is a sovereign country, and deserves to be supported.

[JackBolly]

@Et20 My favorite: To many cows farting, so we need to do something!!! Like eat more chicken.

[The Invisible Hand Wins]

@JackBolly a Chik-Fil-A lobbying effort

[OverTheHorizon]

Just in case:

www.foxbusiness.com/...

[Jpokergman]

Thank you very much to all the ESG frauds hard selling Russian propaganda these past five years.

[imdaman]

@Jpokergman Joe was the one collecting the bribes while libtards deflecting w Russia hoax
Thanks for the oil wealth gains

[freshcupajoe]

Looking due for a pull back here unless Vlad sends tanks over borders.. quite stretched

[alextay]

@freshcupajoe that’s what she said..

[jupenya]

@freshcupajoe Fine, benefit from it - the trend is up & will stay so for a couple of years. US production will be constrained by the current idiotic regime - we some relax in 2024 for Dem election effect. O&G is the green ($) for the near future. PS Putin wins w/out firing a shot.

[Jpokergman]

@freshcupajoe The chances of a real military mind starting a shooting war in winter, between Russia and Ukraine is probably on a par with the odds of a pro golfer nailing a hole in one on a par four…..

[sliman21]

Canadian oils are dirt cheap.

[jupenya]

@sliman21 Try PBR carnival cheap.

[Virtue16]

@sliman21 If you like sand.

[limitspecs38]

@sliman21 - yes they are........have CVE cash cow as my largest holding.....

[bigbenorr]

I would just like to thank all the woke fund managers and sovereign wealth funds who divested all their shares of oil companies. They really helped me to accumulate at ridiculously low prices.

[Tizthelaw2020]

@bigbenorr fully, completely agree. Some misguided energy guidance is now exposed. Lots of ways to make oil and gas industry efficient, but for some it will never be enough.

[~BigZ~]

@bigbenorr :

A special shout-out to “oil is a perma short” Jim Cramer www.cnbc.com/... and “oil will never hit $70” Cathie Wood. seekingalpha.com/...

[pyrite99]

@~BigZ~

One year ago Cramer was claiming fossil energy was "uninvestable" and should be shunned due to climate change. Recently, he was bragging that he was early in recognizing the opportunity in under valued fossil stocks. Same hypocrisy from other wall street self promoters like BLK and GS.

[0xfc]

Go FENY! The cheaper version of XLE.

[Victor Justice]

Long CPG! Up about 20% in the last month, but still about 50% undervalued…

[Dwight50]

Oil, the frumpy kid who goes on to become the prom king.

[The Invisible Hand Wins]

@Dwight50 Best comment ever!!!