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Oil prices scaled higher on May 14 after the US Energy Information Administration (EIA) said that it expects global crude stockpiles to decline in the second half of 2020. Demand for crude is expected to pick up as some countries are poised to relax coronavirus restriction norms and lift lockdowns to allow factories and shops to reopen.
Needless to say, oil prices for quite some time have been under tremendous pressure as widespread lockdowns to counter the spread of coronavirus hit fuel demand, leaving ample supplies that countries found hard to store.
Brent crude rose by $1.94, or 6.7%, to $31.13 a barrel on May 14, and West Texas Intermediate crude was up $2.27, or 9%, to $27.56 a barrel.
Big Winners From Rise in Oil Prices
Rise in oil prices, of course, bodes well for energy players, particularly those involved in exploration and production. Gold prices are also expected to move north on higher oil prices. This is because as crude prices rise, prices of essential goods and commodities follow suit. And value of gold rises when inflation picks up. After all, it acts as a hedge against inflation.
5 Stocks to Snap Up
In view of this, we have shortlisted five oil exploration and production, and gold mining stocks that are poised to grow.
Chaparral Energy, Inc. (CHAP - Free Report) engages in the acquisition, exploration, development, production, and operation of oil and natural gas rigs. The company’s expected earnings growth rate for the current year is 35.6% against the Zacks Oil and Gas - Exploration and Production - United States industry’s projected earnings decline of 35%.
The Zacks Consensus Estimate for its current-year earnings has risen60.5% over the past 60 days. Chaparral Energy flaunts a Zacks Rank #1 (Strong Buy).
AngloGold Ashanti Limited (AU - Free Report) is a gold mining company. This Zacks Rank #1company’s expected earnings growth rate for the current year is 113.2% compared with the Zacks Mining - Gold industry’s projected earnings growth of 22.9%. The Zacks Consensus Estimate for its current-year earnings has climbed4.9% over the past 60 days.
Gold Fields Limited (GFI - Free Report) is a gold producer. The company’s expected earnings growth rate for the current year is nearly 31% compared with the Zacks Mining - Gold industry’s projected earnings growth of 22.9%. The Zacks Consensus Estimate for its current-year earnings has moved7.8% up over the past 60 days. Gold Fields sports a Zacks Rank #1.
HighPoint Resources Corporation (HPR - Free Report) engages in the exploration, development, and production of oil, natural gas, and natural gas liquids. The company’s expected earnings growth rate for the current year is 15% against the Zacks Oil and Gas - Exploration and Production - United States industry’s estimated earnings decline of 35%. The Zacks Consensus Estimate for its current-year earnings has advanced17.9% over the past 60 days. HighPoint Resources holds a Zacks Rank #2 (Buy).
Key Energy Services, Inc. (KEGX - Free Report) operates as an onshore rig-based well-servicing contractor. This Zacks Rank #2company’s expected earnings growth rate for the current year is 96.6% against the Zacks Oil and Gas - Drilling industry’s projected earnings decline of more than 100%. The Zacks Consensus Estimate for its current-year earnings has moved up96.9% over the past 60 days.
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