3 Eagle Ford Stocks Poised to Gain With Oil at $80
The current high oil price, stemming from the International Energy Agency's upward adjustment of its oil demand forecasts for this year and an unexpected decline in U.S. inventories, is prompting increased exploration and production activities. Consequently, companies in the upstream sector are expected to expand their operations in profitable shale resources, resulting in a rise in the number of drilling rigs. This uptick in drilling activity is forecast to enhance production, offering benefits for businesses involved in exploration and production.
High Oil Price
West Texas Intermediate crude price has touched $80 per barrel, which is highly favorable for exploration and production activities. In its short-term energy outlook, the U.S. Energy Information Administration (EIA) projected the average spot price of West Texas Intermediate crude at $82.15 per barrel this year, an extremely promising price for upstream operations.
Eagle Ford Oil Production to Rise
In March, total oil production from shale resources in the United States will likely increase by 20,000 barrels per day to 9,716 thousand barrels per day (MBbl/D), per EIA. The shale resources comprise Anadarko, Appalachia, Bakken, Eagle Ford, Haynesville, Niobrara and Permian.
Of all the resources, Eagle Ford will witness the second-highest increase in daily oil production, after Permian, this month, according to the EIA’s drilling productivity report. In the Eagle Ford, the EIA projects oil production to rise by 5,000 barrels per day to 1,145 MBbls/D this month.
Eagle Ford Explorers in the Spotlight
It has been apparent that a favorable crude pricing scenario is backing higher production volumes. Improving Eagle Ford production amid healthy oil prices raised the incentive to keep an eye on companies like Matador Resources Company MTDR, ConocoPhillips COP and Marathon Oil Corporation MRO operating in the prolific shale play. All the stocks carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
3 Stocks to Gain
Matador Resources’ principal operating areas comprise Eagle Ford shale, where its presence is spread across 12,100 net acres. The majority of the company’s production from the resource comprises oil and is thus well positioned to gain from the handsome price of the commodity.
ConocoPhillips has a strong footprint in key resources in the United States. This comprises Eagle Ford resources which was responsible for producing 211 thousand barrels of oil equivalent production per day in the fourth quarter of 2023.
In the Eagle Ford, Marathon Oil has been operating since 2011. The company allocated a significant proportion of its capital budget for this year toward prolific resources. In the fourth quarter of 2023, Marathon Oil produced 144,000 net barrels of oil equivalent per day from Eagle Ford shale play.
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ConocoPhillips (COP) : Free Stock Analysis Report
Marathon Oil Corporation (MRO) : Free Stock Analysis Report
Matador Resources Company (MTDR) : Free Stock Analysis Report
