Best stocks 3 look for.....in energy sector in 2024.
Best Energy Stocks for Investors in January 2024
The global energy market remains a volatile landscape, influenced by various factors that have propelled it in different directions. Recent developments, such as a sharp price cut by Saudi Arabia and increased production among OPEC+ members, have contributed to a decline in crude oil prices. Despite the market’s turbulence, savvy investors can still find opportunities in the energy sector. This article explores the current dynamics and highlights three top energy stocks recommended for January 2024.
Crude Oil Market Overview:
As the new year unfolds, Brent crude oil, the international standard, is trading at $76.80 per barrel, while West Texas Intermediate (WTI) crude oil, the U.S. benchmark, stands at $71.35 per barrel. This reflects a 14% decrease in WTI prices over the last three months. The volatility is attributed to Saudi Arabia’s decision to cut the February official selling price of Arab Light crude oil to Asia, coupled with production increases in Iraq, Angola, and Nigeria. Meanwhile, U.S. natural gas prices have risen by 13% due to escalating militant attacks along the Red Sea shipping corridor.
Best Energy Stocks for January 2024:
- Occidental Petroleum (NYSE: OXY):
Famed investor Warren Buffett has continued to amass shares of Occidental Petroleum, increasing his stake to 34%. Despite OXY stock currently trading at $57 per share, near a 52-week low, Buffett remains bullish. The decline in Occidental’s stock is primarily attributed to weakness in energy prices, with crude oil hovering around $72 per barrel. Buffett’s strategic purchases align with his practice of buying aggressively whenever the stock falls to $60 or lower. The recent acquisition announcement of CrownRock, a privately held oil-and-gas company, for $12 billion has further fueled Buffett’s confidence.
- Suncor Energy (NYSE: SU):
Suncor Energy, a Canadian oil producer, presents a turnaround story. After hitting a low point in mid-December, the stock has gained 7% in the past month. Suncor undertook significant measures to enhance its business, including a leadership change and job cuts. Activist investor Elliott Management’s 3.4% stake in the company catalyzed a push for positive change. Suncor’s management is focusing on cost-cutting initiatives to boost earnings and is considering the sale of its retail gas station network, potentially earning $8 billion. The stock is up 4% over the last 12 months.
- Chevron Corporation (NYSE: CVX):
Chevron’s stock is currently trading near its 52-week low, down 15% since October 2023 when the company announced its intention to acquire Hess Corp. for $53 billion. While the deal has faced skepticism, Chevron’s strategic moves to expand reserves and build lower-carbon businesses instill confidence. Once the Hess deal is finalized, Chevron plans to buy back $20 billion of its stock annually, equivalent to about 6% of outstanding shares. Trading at 10 times future earnings estimates and offering a quarterly dividend of $1.51 per share (yield of 4.17%), CVX stock appears attractively valued.
Despite the ongoing volatility in the global energy market, there are enticing opportunities for investors in January 2024. Occidental Petroleum, Suncor Energy, and Chevron Corporation, each with its unique strengths and strategic initiatives, present compelling options for investors seeking value in the energy sector. It is essential for investors to conduct thorough research and consider their risk tolerance before making investment decisions.
