ConocoPhillips’s correlations last week
As we discussed in the previous part, ConocoPhillips’s (COP) stock price rose marginally by 0.06% last week. Even crude oil and natural gas rose 2% and 7.7%, respectively, during the same week. However, the SPDR S&P 500 ETF (SPY) fell 0.14%. In this part, we’ll discuss the relationship between the daily movements in ConocoPhillips’s stock price and crude oil prices. We’ll look at ConocoPhillips stock’s correlation coefficient with crude oil in the past week and the past month. We’ll also see how ConocoPhillips’s stock price followed daily natural gas prices and the S&P 500 Index during the same periods.
For the week ending November 10, ConocoPhillips stock showed a correlation of ~75% with crude oil (USO) (SCO). Movements in crude oil had a very high influence on ConocoPhillips stock. The stock’s correlation with SPY was positive at ~69%, which means that movements in ConocoPhillips stock were in tandem with SPY last week.
In comparison to crude oil and SPY, ConocoPhillips stock’s correlations with natural gas (UNG) were negative at -74%. It means that movements in natural gas didn’t influence ConocoPhillips stock much last week.
ConocoPhillips’s peer Devon Energy (DVN) had a correlation of ~81% with crude oil prices last week. It rose ~3% due to increased crude prices. Devon Energy had a correlation of -53% and ~5% with natural gas and SPY last week. Devon Energy’s production mix contains ~62% liquids. As a result, Devon Energy has a high correlation with crude oil prices.