Correlation between Schlumberger and crude oil
SLB’s correlation with crude oil and its implication
The price of WTI (West Texas Intermediate) crude oil has risen significantly since the end of June 2017. Analysts don’t expect much impending downside in the price of crude oil. A strong positive correlation could help SLB stock if crude oil rises. Schlumberger’s correlation with crude oil increased in the week ended February 2, 2018, compared to the previous year.
Also, SLB’s positive correlation with the Dow Jones Industrial Average index could mean it was profiting from the record highs of the broader equity markets before last week.
Correlation between oilfield services companies and crude oil
The correlation coefficient of the VanEck Vectors Oil Services ETF (OIH) with crude oil since January 26, 2018, was 0.21. Helmerich & Payne’s (HP) correlation for the same period was 0.45, McDermott International’s (MDR) was 0.67, and Oil States International’s (OIS) was 0.30.
Read Market Realist’s The 5 Worst Oilfield Companies by Year-to-Date Returns. Also, read Market Realist’s The 5 Worst Oilfield Companies by Free Cash Flow.