Short interest in Suncor
The short interest in Suncor Energy (SU) has risen from 0.28% on October 1 (the beginning of the fourth quarter) to the current level of 0.70%. Usually, a rise in the short interest implies an increase in the bearish sentiments in a stock. During the same period, Suncor stock has fallen 21.8%.
Why did the sentiment change?
The rise in bearish sentiments in Suncor could have been due to its lower-than-expected third-quarter earnings, a decline in oil prices, and the government of Alberta’s production cut announcement. We discussed Suncor’s third-quarter earnings miss earlier in this series. WTI (West Texas Intermediate), the benchmark oil, has fallen 30% since October 1.
The production cut announcement could have led to more bearish sentiments. The government of Alberta announced production cuts to address the supply glut in the region. However, Suncor expects its production to grow 10% in 2019 despite the cuts.
Peers’ short interest
Since October 1, the short interest in YPF (YPF) and PetroChina (PTR) has risen by 0.06 percentage points and 0.01 percentage points. Currently, the short interest in YPF and PetroChina stands at 0.67% and 0.11%, respectively. The short interest in Royal Dutch Shell (RDS.A) has risen by 0.01 percentage points to 0.13%.
Since October 1, Shell and PetroChina’s stock prices have fallen 15.0% and 25.2%, respectively. However, YPF stock has risen 0.4%.