Investing

Short Sellers Abandon Oil Stocks as Crude Prices Rise

Paul Ausick

Published: December 26, 2019 7:25 am

Last Updated: January 30, 2020 11:50 am

Crude oil traded around $61.25 a barrel early Thursday, up about $0.15 in the past week but still well short of a high of $62.90 posted on September 16, the first trading day following the attack on the Saudi oil processing plants. Over the past month, the price of West Texas Intermediate (WTI) crude for immediate delivery has increased by more than $3.00 a barrel.

Of the companies we watch, short interest decreased on five of six energy stocks during the two-week reporting period ending December 13. Last week, we posted our list of 10 undervalued energy stocks as a new year and a new decade begins.

Chevron Corp. (NYSE: CVX) saw short interest increase by 1% to 20.29 million shares, which represents about 1.1% of the company’s float. Days to cover remained unchanged at four. In the two-week short interest period, the stock’s share price increased by about 0.9%. Its 52-week range is $104.88 to $127.34, and it closed at $120.34 on Tuesday, essentially flat for the day.

Exxon Mobil Corp. (NYSE: XOM) short interest fell by 2% to 38.33 million shares, or 0.9% of the company’s float. In the two weeks to December 13, the share price rose by about 2.2%. The stock’s 52-week range is $66.08 to $83.49, and it closed at $70.02 on Tuesday, down about 0.4%for the day. Days to cover remained at three.

BP PLC (NYSE: BP) saw a drop of 11% in short interest during the two-week period. About 0.15% of the total float, or 5.04 million American depositary shares, were short, and days to cover remained less than one. The company’s shares traded down by about 1.2% over the period and closed Tuesday at $38.04, down by about 0.2% for the day, in a 52-week range of $35.73 to $45.38.

ConocoPhillips (NYSE: COP) short interest decreased by 4% in the first half of December. Some 11.41 million shares were short, representing about 1% of the company’s total float. Days to cover remained at two, and the stock price increased by about 4.6% during the period. Shares closed Tuesday at $64.67, up about 0.1% for the day, in a 52-week range of $50.13 to $71.01.

Petróleo Brasileiro S.A. (NYSE: PBR), or Petrobras, posted a drop of 22% in short interest during the period. Some 15.77 million American depositary shares were short as of December 13, less than 1% of the total float. They closed at $15.87 on Tuesday, down by less than 0.1% for the day, in a 52-week range of $12.40 to $17.90. Shares traded up by around 4.6% in the short interest period, and days to cover remained at one.

Occidental Petroleum Corp. (NYSE: OXY) saw short interest drop by 3% to 21.11 million shares. Days to cover remained at two, and about 2.4% of the company’s shares were short. By December 13, the share price had increased about 1%. The stock’s 52-week range is $37.25 to $68.83, and shares closed Tuesday at $39.89, up about 0.5% for the day.