ConocoPhillips COP has decided to slowly increase production of oil and natural gas since the commodity pricing scenario is improving.
It is to be noted that the price of West Texas Intermediate (WTI) recently touched the $40-per-barrel mark and has surged more than 51% in the past month. The commodity price is likely to improve further since more people are returning to work, raising fuel demand.
Earlier, the coronavirus-dented global energy demand convinced many energy players to impose production cap by curtailing operations. Now, the improved oil prices have convinced many upstream companies to remove the self-imposed cap and to restart producing from the wells, added ConocoPhillips. EOG Resources Inc EOG, among the leading shale players in the United States, has reportedly decided to accelerate oil production in second-half 2020 after curtailing a quarter of oil volumes in May. Moreover, Parsley Energy PE, with a strong footprint in the Permian basin, recently unveiled plans in a presentation to restore a significant proportion of curtailed oil volumes in early June.
ConocoPhillips has also planned the gradual increasing of production volumes over the next few months. Thus, the explorer, which shut down a third of its production in May and June, will be responding to the surge in oil prices by slowly increasing volumes.
Overall, oil production volumes in the United States will be recovering slowly with many upstream players considering to increase production volumes in the shale plays to capitalize the improving oil prices. However, ConocoPhillips expressed doubts over U.S. oil production volume recovery to 13 million barrels a day – the pre-coronavirus production levels.
ConocoPhillips price | ConocoPhillips Quote
Headquartered in Houston, TX, ConocoPhillipscurrently carries a a Zacks Rank #3 (Hold). Meanwhile, a better-ranked player in the energy space is Murphy USA Inc. MUSA, sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Murphy USA is likely to see earnings growth of 7% in the next five years.
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Parsley Energy, Inc….