Oil has been the most talked-about sector this month, for the right and wrong reasons.
Oil prices have reached an all-time high, breaking over $130 a barrel. Not only does the price of oil affect gas prices, but it also has a big impact on the entire stock market.
As traders, we see that as an opportunity to dive into a hot sector with momentum. As a result of oil prices rapidly rising to all-time highs, individual stocks in the oil and gas sector are also getting a boost creating high quality trading opportunities for us momentum traders!
Today, we wanted to dive into our top oil stocks you need to keep on your watchlist for opportunities to the upside and downside as the volatility in oil continues to increase:
Occidental Petroleum Corporation
$OXY
Recently news came out of a big investment by Warren Buffet for north of $5 billion dollars, $OXY has had a great run into the mid $50 range. Being one of the most well-known and established oil and gas companies on this list, together with its subsidiaries, engages in the acquisition, exploration, and development of oil and gas properties in the United States, the Middle East, Africa, and Latin America. Occidental operates through three segments: Oil and Gas, Chemical, and Midstream Marketing giving it exposure to multiple different revenue streams.
It has been one of the top 5 distributors and producers of oil in the United States for the past 3 years, giving it such a great and strong reputation. Due to its healthy dividend, it is also a popular stock for long-term investors to park their cash. $OXY has been a great stock for us over the past few weeks to trade as well, giving some great volatility to take advantage of. (You can learn exactly how we trade these moves and more by joining our upcoming Live Trading Boot camp)
U.S. Well Services, Inc.
$USWS
Currently priced below $2/share, the oil stock $USWS has gained some traction and volume off of its lows over the past week. Headquartered in Houston, TX, a major oil and gas industry hub, the company operates as an oilfield service company in the United States. It provides hydraulic fracturing services to the oil and natural gas exploration, and production services. As the U.S begins to produce and drill more of its own oil, the sights turn to companies like U.S. Well Services here and others on this list that play a role in ramping up U.S. oil and gas production/drilling. after a few big down days, it may catch a quick bounce next week.
W&T Offshore, Inc.
$WTI
Also located in Houston, TX, W&T Offshore, Inc. is an independent oil and gas producer. They engage in the acquisition, exploration, and development of oil and natural gas properties in the Gulf of Mexico. W&T Offshore, Inc. company sells crude oil, natural gas liquids, and natural gas internationally but more prominently domestically. They also hold a working interest in approximately 41 offshore fields in federal and state waters and have interests in offshore leases covering 669,000 net acres spanning across the Outer Continental Shelf off the coasts of Louisiana, Texas, Mississippi, and Alabama.
Currently, they have one of the largest growing working interests in federal waters and are rapidly growing. Priced just around $6/share, this company has great long-term potential for growth if the U.S. continues to look towards increasing independent production. Trading consistent volume as well, this stock can be a great tradable and investable asset. Similar set up to many of these names, this is pulling back to the former $5 resistance level, which as momentum traders know, often turns into support and could give us a bounce soon. One of the top oil stocks to watch right now for us.
Houston American Energy Corp.
$HUSA
One of the most frequently moving and volatile stocks on our list (due to its low public float), Houston American Energy Corp. can be a great vehicle to trade. Located in the oil hub of Houston, they are an independent energy company that explores, develops, and produces natural gas, crude oil, and condensate. Their properties are located adjacent to some of W&T Offshore, Inc. around the Texas Permian Basin, the onshore Texas and Louisiana Gulf Coast region, and in Columbia. Established in 2001, the company has been focusing on crude oil production primarily, which is extremely important right now in the United States.
Exxon Mobile Corporation
$XOM
Many readers have heard of Exxon Mobil, and probably have even stopped at their stations. One of the most reknown oil stocks. But, what many don’t know is how big of a role Exxon plays in the production of oil and natural gas in the United States. Just like $OXY, Exxon is one of the top 5 oil-producing companies in the United States and has a massive distribution chain nationwide to aid in the trade transport, and sale of crude oil, natural gas, petroleum products, petrochemicals, and other oil and gas products. As of December 31, 2021, it had approximately 20,528 net operated wells with proved reserves. This is more of a swing trading stock, it looks like a good mover if you like slower-moving names, or you trade options.
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