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Oil-Weighted Stocks after Crude Oil’s 2016 High and Low

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Oil-weighted stocks’ performance from crude oil low in 2016

On February 11, 2016, US crude oil (USL) touched a 12-year low. Between February 11, 2016, and May 9, 2016, US crude oil gained 65.7%. The basket of these equally weighted upstream stocks gained 69.8% over this period. Denbury Resources (DNR), California Resources (CRC), and Bill Barrett (BBG) returned 241.7%, 167%, and 128% during this time. During the same period, Synergy Resources (SYRG) and Vaalco Energy (EGY) gained 2% and 1.9%. Triangle Petroleum (TPLM) lost 7.2%. These three stocks underperformed their peers between February 11, 2016, and May 9, 2016.

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Oil-weighted stock performance from crude oil high in 2016

On April 28, 2016, US crude oil futures closed at $46.03—the highest level for crude oil for 2016 to date. Between April 28, 2016, and May 9, 2016, crude oil lost 17.4%. The basket of these equally weighted upstream stocks lost 14.6%. During the same period, US-based (SPXL)(SPY)(QQQ)(IWM)(IWF) upstream stock Continental Resources (CLR) gained 2.1%. RSP Permian (RSPP) and Diamondback Energy (FANG) fell 0.68% and 1.3%. However, these three stocks outperformed their peers between April 28 and May 9, 2016. California Resources (CRC), Halcon Resources (HK), and Kosmos Energy (KOS) fell 26.5%, 27%, and 27.5%, respectively, over this period. Halcon Resources and California Resources lost the most compared to their peers.

So, our basket of oil-weighted stocks outperformed crude oil since its 2016 low on February 11 and since its 2016 high on April 28.

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