Why Did XOM, CVX, RDS.A, and BP Rise in Q1?



Integrated energy stocks

In the first quarter from January 2–March 29, ExxonMobil (XOM) stock rose 15.9%—the highest among its peers including BP (BP), Chevron (CVX), and Royal Dutch Shell (RDS.A). BP rose 13.3% in the first quarter. Chevron and Shell rose 11.3% and 5.5%, respectively, during the same period.

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Markets and oil in the first quarter

Since the markets and oil impact integrated energy stocks, we’ll discuss their performances in the first quarter.

In the first quarter, WTI, the benchmark oil, rose 29.2%. Oil prices rose due to OPEC’s production cuts. The possibility of the cuts being extended in the second half of 2019 boosted oil prices. The US sanctions against Iran and Venezuela supported oil prices. To learn more about oil prices, read Barclays Expects Higher Oil Prices in the Second Quarter.

The US equity market, represented by the SPDR S&P 500 ETF (SPY), rose 13.0% in the first quarter. The market saw the biggest quarterly gain in the past decade. Optimism about the US-China trade talks, better company earnings, and the expectation of no interest rate hikes in 2019 supported the market.

Earnings performance

All four of the companies beat analysts’ earnings estimate for the fourth quarter of 2018, which supported the stocks.

Integrated energy stocks have risen in the first quarter. Higher oil prices, stronger equity markets, and better-than-expected fourth-quarter earnings supported these stocks in the first quarter.


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