Did Trade Talks Impact Oil-Weighted Stocks More than Oil?


Jan. 10 2019, Published 11:59 a.m. ET

Oil-weighted stocks

The following oil-weighted stocks could be the most sensitive to US crude oil’s movements. They might be impacted the most by oil’s price movement based on their correlations with US crude oil active futures in the trailing week:

  • ConocoPhillips (COP) at 70.5%
  • Concho Resources (CXO) at 65.6%.
  • Oasis Petroleum (OAS) at 49.2%
  • EOG Resources (EOG) at 37.4%
  • Diamondback Energy (FANG) at 27.3%
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Impact of trade talks

In the trailing week, US crude oil active futures rose 12.5%. Occidental Petroleum was the third-largest gainer on our list of oil-weighted stocks. The top gainers, Callon Petroleum (CPE) and Whiting Petroleum (WLL) rose 30.5% and 20.6%, respectively, in the trailing week despite having a mild negative correlation with oil prices. The trade talks between the US and China might have caused these stocks to increase. In the previous part, we discussed that easing trade war concerns might be behind the rise in oil prices. ConocoPhillips had the highest correlation with oil. ConocoPhillips has risen 4.8%—the lowest among our selected oil-weighted stocks.

All of these oil-weighted stocks are part of the SPDR S&P Oil & Gas Exploration & Production ETF (XOP). They have production mixes of at least 60.0% in liquids based on their latest quarterly production data. Liquids include crude oil, condensates, and natural gas liquids.


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