As you probably know by now, our weekly articles always involve a light scoop of one interesting topic; and then a neat little list of all of the most important trading events this coming week. This week, we’re talking OIL!
Where are we at with OIL?
Crude oil price declined slightly during the Asian session as traders reacted to news that OPEC and its allies were considering easing oil supply cuts. According to Wall Street Journal sources, the countries are planning to relax the curbs by 2 million barrels a day to 7.7 million. The report came two days after IEA said that the worst effects of coronavirus on oil demand had passed but will continue to echo as the market recovers. The group will hold a virtual meeting on Wednesday this week.
Let’s investigate some of the largest players in the oil industry. How has the pandemic affected them and how are their stocks faring? Let’s take a closer look.
A sneak peek at some of the energy industry’s most energetic
The global pandemic, or rather our forced reaction to it, has been totally unbiased in its effect on industries. Due to their reliance on consumer demand, energies — most notably oil — have borne the brunt of that.
Let’s see how some of the industry’s biggest names are doing.
Phillips 66 (NYSE: PSX)
Price on 02.01: 112.20 USD
Price on 10.07: 61.06 USD
YTD high: 112.20 USD
YTD low: 42.09 USD
YTD % change: -45.58%
Lukoil (MCX: LKOH)
Price on 03.01: 6,294 RUB
Price on 10.07: 5,100 RUB
YTD high: 6,717 RUB
YTD low: 3,754 RUB
YTD % change: -18.97%
Source: Yahoo Finance
Chevron (NYSE: CVX)
Price on 02.01: 121.43 USD
Price on 10.07: 85.23 USD
YTD high: 121.43 USD
YTD low: 54.22 USD
YTD % change: -29.81%
Total (EPA: FP)
Price on 02.01: 49.82 EUR
Price on 10.07: 33.32 EUR
YTD high: 49.82 EUR
YTD low: 21.80 EUR
YTD % change: -33.12%
Exxon Mobil (NYSE: XOM)
Price on 02.01: 70.90 USD
Price on 10.07: 42.65 USD
YTD high: 70.90 USD
YTD low: 31.45 USD
YTD % change: -39.84%
BP Plc (LON: BP)
Price on 02.01: 480.85 GBX
Price on 10.07: 290.80 GBX
YTD high: 504.10 GBX
YTD low: 233.79 GBX
YTD % change: -39.52%
Sinopec (NYSE: SNP)
Price on 02.01: 61.22 USD
Price on 10.07: 44.35 USD
YTD high: 61.95 USD
YTD low: 42.14 USD
YTD % change: -27.56%
There you have it. Not great reading, right?
This list of companies spreads the entire globe, from the US, to the UK, Europe and China — they’ve all been rocked. Most of these guys had their year-to-date highs at the very start of the year and have struggled to claw back that ground. What’s making this drop worse is the sheer lack of demand for petroleum.
Throughout the pandemic, most countries have, and still are, imposing (or re-imposing) lockdowns and/or some form of movement restrictions. Many are working from home and not needing to commute. The aviation industry also ground to a halt, although it’s seeing a moderate return to service now. Quite simply, to date, we’ve not needed the commodity that we’re usually so desperate for and that’s hit these companies hard.
One thing to note is that these companies are not just big hitters in the energy industry. These guys are some of the biggest, most profitable companies in the world and their stock has dipped between 18% and almost 50%. That truly shows the magnitude of this crisis.
The good news for some is that most of these companies have now made up around 50% of the value from their lowest point. However, fears of a ‘second wave’ of Coronavirus in the winter have led many an investor to remain cautious.
You’re definitely going to want to keep an eye on how these companies are performing, they’re a good yardstick for the global economy getting back on its feet. Or not, as the case may be.
Key events this week
Here’s everything you need to know.
No major events scheduled.
● The UK will release its latest MoM and YoY GDP figures (GBP).
● Over in the States, the US will announce its latest inflation rate YoY figures (USD).
● “Interest Rate Day” kicks off with the Bank of Japan announcing its Interest Rate decision and Quarterly Outlook (JPY).
● This will be followed swiftly by the UKs very own YoY Interest Rate announcement (GBP).
● Finally, the Bank of Canada will follow suit with an announcement of their own Interest Rates (CAD).
● New Zealand (NZD) and the EU (EUR) didn’t get the memo and will announce their Interest Rate decisions a day later.
● Australia (AUD) and the UK (GBP) will update us on their respective employment figures.
● China will announce its YoY GDP Growth Rate (CNY).
● We’ll hear from the US on its MoM Retail Sales figures (USD).
● At the end of the week, the EU will host a meeting designed to debate a Common Recovery Plan (EUR).
● We’ll also hear the EU’s Core Inflation Rate YoY for June (EUR).
So… BUSY! Top tip: don’t forget to eat and sleep somewhere throughout all of that.
Are you loving our Monday article series almost as much as the other epic content on our blog? If you think a light, informative article is what your traders or investors are desperate for, contact us and let’s get started.
The Contentworks team