Oct. 22 at 7:21 PM
Oil Stocks Look Shaky as Oversupply Grows — But Two Names Stand Out
Global oil supply has surged by over two million barrels a day from OPEC+ and others, while demand has risen by less than one million, creating a glut of about 1.9 million barrels per day. The International Energy Agency expects the surplus to reach nearly four million barrels per day by 2026.
Oil prices have dropped around 20% this year, and the market’s contango structure suggests continued weakness as traders opt to store oil rather than sell it.
Diversified giants like Exxon Mobil and Chevron have held up better—up 6.3% and 5.6%, respectively—thanks to their refining and gas operations, while production-focused firms like EOG Resources are down 15%.
Evercore’s Stephen Richardson advises investors to be selective, favoring Baker Hughes for its strong gas exposure and ConocoPhillips for its low-cost supply, consistent shareholder returns, and 3.6% dividend yield.
$XOM $CVX $EOG $BKR