Yahoo Finance Oil Rises Despite Supply Build on All Fronts, OPEC in Focus
U.S. oil prices rose on Wednesday, with traders waiting to see whether major producers agree to extend their voluntary output cuts to shore up prices at a meeting expected on Thursday. Meanwhile, a weekly report from the Energy Information Administration ("EIA") showing builds in crude and fuel stockpiles limited the upside.
On the New York Mercantile Exchange, WTI crude futures gained $1.45, or 1.9%, to close at $77.86 a barrel yesterday.
With oil crawling back toward $80 per barrel — a healthy enough level for market participants —investors interested in the sector could benefit from having quality stocks like Suncor Energy SU, EOG Resources EOG and Murphy Oil MUR.
Let's dig deep into EIA’s Weekly Petroleum Status Report for the week ending Nov 24.
Analyzing the Latest EIA Report
Crude Oil: The federal government’s EIA report revealed that crude inventories rose 1.6 million barrels compared to expectations of a 700,000-barrel decrease per the analysts surveyed by S&P Global Commodity Insights. The stockpile build with the world’s biggest oil consumer was largely thanks to continued high domestic production, which, at 13.2 million barrels per day, is the highest on record. This more than offset the rise in refinery demand.
Total domestic stock now stands at 449.7 million barrels — 7.3% above the year-ago figure of 419.1 million barrels and slightly more than the five-year average.
The latest report also showed that supplies at the Cushing terminal (the key delivery hub for U.S. crude futures traded on the New York Mercantile Exchange) gained 1.9 million barrels to 27.7 million barrels — the highest since August.
Meanwhile, the crude supply cover decreased from 29.2 days in the previous week to 28.9 days. In the year-ago period, the supply cover was 25.7 days.
Let’s turn to the products now.
Gasoline: Gasoline supplies increased for the second successive week. The 1.8 million-barrel rise was primarily attributable to softening demand. Analysts had forecast that gasoline inventories would gain 200,000 barrels. At 218.2 million barrels, the current stock of the most widely used petroleum product is 2.1% more than the year-earlier level, while it is 2% below the five-year average range.
Distillate: Distillate fuel supplies (including diesel and heating oil) rose after dropping for eight straight weeks. The 5.2 million-barrel increase mainly reflected plunging consumption. Meanwhile, the market looked for a supply decline of 100,000 barrels. Following last week’s build, current inventories — at 110.8 million barrels — are 1.6% below the year-ago level and 11% lower than the five-year average.
Refinery Rates: Refinery utilization, at 89.8%, rose 2.8% from the prior week.
3 Energy Stocks to Buy
Having gone through the Weekly Petroleum Status Report, investors interested in the energy space might consider the operators mentioned below. Each of these companies currently carries a Zacks Rank #2 (Buy).
You can see the complete list of today’s Zacks #1 Rank stocks here.
Suncor Energy: SU beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters at an average of 15.7%.
Suncor Energy is valued at around $42.5 billion. SU has seen its shares move down 4.3% in a year.
EOG Resources: EOG Resources beat the Zacks Consensus Estimate for earnings in three of the last four quarters and missed in the other. EOG has a trailing four-quarter earnings surprise of 9.2%, on average.
EOG Resources is valued at around $72 billion. EOG has seen its shares drop 9.6% in a year.
Murphy Oil: Over the last 60 days, Murphy Oil saw the Zacks Consensus Estimate for 2023 move up 11.5%. MUR beat the Zacks Consensus Estimate for earnings in each of the last four quarters, representing an average surprise of 13.4%.
Murphy Oil is valued at around $6.7 billion. MUR has seen its shares lose 8.5% in a year.
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EOG Resources, Inc. (EOG) : Free Stock Analysis Report
Murphy Oil Corporation (MUR) : Free Stock Analysis Report
Suncor Energy Inc. (SU) : Free Stock Analysis Report
