Crude oil and natural gas prices
For the week ending September 8, 2017, crude oil (USO) prices rose from $47.29 per barrel to $47.48 per barrel—a modest increase of less than half a percentage point. Currently, crude oil prices are trading below their 200-day moving average, which stands at $49.59. Natural gas (UNG) prices fell ~6% last week. Natural gas prices fell from $3.07 per MMBtu (million British thermal units) to $2.89 per MMBtu.
ConocoPhillips’s production mix contains ~60% liquids and ~40% natural gas. Due to the higher percentage of liquids (crude oil, bitumen, and natural gas liquids), ConocoPhillips’s stock price should be more sensitive to crude oil prices than natural gas prices.
ConocoPhillips’s stock performance
Despite a mixed price performance from crude oil (USO) and natural gas (UNG) prices last week, ConocoPhillips’s (COP) stock price rose. Its stock price increased marginally by half a percentage point or from $44.24 to $44.47. Its stock price rose on the first three days of the week, which helped it close the week on positive note.
To judge the shorter-term trend for the stock, you need to look at the daily metrics. On September 8, ConocoPhillips’s stock price closed at $44.47, while its 200-day and 50-day moving averages stood at $46.48 and $43.95, respectively. Its stock price is trading below its 200-day moving average but above its 50-day moving average. In fact, ConocoPhillips crossed above its 50-day moving average on September 1, 2017. However, its 50-day moving average is below its 200-day moving average, which is technically a bearish sign for the stock.
The Energy Select Sector SPDR ETF (XLE) produced a positive performance despite the mixed performance from crude oil and natural gas prices last week. Even XLE outperformed the SPDR S&P 500 ETF (SPY) during the week. XLE rose by more than one percentage point, while SPY rose marginally by half a percentage point. Murphy Oil (MUR) rose ~1%, while Encana (ECA) fell ~2% last week. Just like ConocoPhillips, Murphy Oil and Encana also have operations in Montney, Canada.
In the next part, we’ll look at ConocoPhillips’s implied volatility.