Oil Price Boost
Shares in US energy company Phillips 66 are surging higher ahead of the US open today on the back of a solid 6.5% gain yesterday. The rally comes on the back of the recent OPEC+ production cut announcement which has seen oil prices increasing and many players revising higher their oil price targets for the year. With this, energy companies look set to reap higher profits near-term, reflected in the rally seen in Phillips’ stock price.
Biofuels Project
Alongside the gains being made in the fossil fuels sector, the company recently announced a new biofuels project. As part of the plans, Phillips will cease crude production in Rodeo California and will instead build a renewable diesel plant. While the plans have drawn criticism from some sections of the community and environmental action groups, Phillips hopes the plant will prove a valuable template for further such projects going forward.
Upside View
Near-term, with US rates unlikely to rise at the pace previously assumed and with oil prices now looking vulnerable to further gains, the company’s stock looks to have room to advance further. Energy stocks across the board have been higher on the back of the OPEC+ announcement and with the group signalling further potential cuts to come, higher oil prices look likely again.
Technical Views
Phillips 66
Stocks prices bounced recently off the 94.43 level and bull channel lows and have since turned higher. With momentum studies turning higher also, the focus is on a breakout above the 11.14 level and a move up towards the 120.38 level next.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.