Long-term investors should appreciate any oil company that can survive today and prepare for the future while making its investors happy.
This study was not only a good sign for the long-term health of these giant public energy companies, but also a good sign for some national oil companies.
If short-term investors keep the stock prices of these oil giants down, these equities could present bargains as investments with a longer horizon.
For example, as Aramco prepares for its (IPO), its success and positioning will be compared to these energy giants.
The price of oil is low, but these majors are still paying dividends—to appease investors—and investing in capital-intensive projects that will profit in the long run when the fluctuating price of oil trends higher.
Oil Price To Rise 20 Percent
“We believe the implemented production cuts will trigger a material drawdown in OECD oil inventories and thus higher crude oil prices,” he said.
Inventories increased by 0.9 million barrels to touch a new record high of 534 million barrels.
Until then, it will be difficult for oil prices to break higher,” noted Harshal Barot, Commodities Analyst at Motilal Oswal.
Before today’s rise, oil prices have been hit over the last few weeks as more US drillers jump on board to take advantage of higher prices which has for the time being offset the pressure of production cuts from OPEC.
US inventories alone have increased 55 million barrels so far this year.
API Reports 1.83 Million Barrel Inventory Draw, WTI Oil Price Fails To Extend Gains
Gasoline inventories recorded a draw of 2.56 million barrels after a draw of 1.10 million barrels last week while distillate registered a draw of 2.09 million barrels, very similar to the draw recorded the previous week.
The latest weekly American Petroleum Institute (API) inventory data for the week ending March 31st reported a draw of 1.83 million barrels.
This draw followed a build of 1.91 million barrels last week and was only the 3rd draw in the past 3 months.
Consensus forecasts were for a small draw in stocks for the week of around 0.3 million barrels.
Cushing recorded a build of 1.34 million barrels and there have been builds in 3 of the past 4 weeks.