Implied volatility in integrated stocks
The implied volatility in integrated energy shares fell in the first quarter. ExxonMobil (XOM) saw the highest fall in its implied volatility compared to BP (BP), Chevron (CVX), and Royal Dutch Shell (RDS.A).
The implied volatility in ExxonMobil and Chevron fell by 12.3 percentage points and 10.0 percentage points, respectively, from January 2 to 16.5% and 18.6%, respectively, on March 29. The change in the implied volatility was less in the other two stocks. The implied volatility in Shell and BP fell by 8.7 percentage points and 8.4 percentage points, respectively, during the same period. On March 29, the implied volatility in Shell and BP was 15.9% and 17.5%, respectively.
Chevron was the highest compared to ExxonMobil, Shell, and BP based on the absolute implied volatility levels. During the stated period, Chevron stock rose 11.3%. ExxonMobil, Shell, and BP rose 15.9%, 5.5%, and 13.3%, respectively.
Price range forecast until June 28
Considering integrated energy shares’ latest implied volatility and assuming a normal distribution of prices and standard deviation of one with a probability of 68.2%, integrated energy shares could close within their upper and lower price bands in the second quarter ending on June 28.
In the above chart, you can see that Chevron stock could have the most significant percentage gain or loss in the second quarter. Chevron could close between $134.6 and $111.7 per share. In contrast, Shell could have the smallest gain or loss. Shell could close between $67.6 and $57.6 per share. ExxonMobil could close between $87.5 per share and $74.1 per share. BP could close between $47.5 per share and $39.9 per share.