(CHK) (REN) (TPLM) | A Glimmer Of Hope For Oil Stocks

Chesapeake Energy Corporation (NYSE: CHK) | Resolute Energy Corp (NYSE: REN) | Triangle Petroleum Corporation (NYSEMKT: TPLM)

Cheaspeake Energy, Resolute Energy, and Triangle petroleum all have one big thing in common. The flagship product at each one of these businesses is oil. As a result, each one of them have been met with massive volatility in the market, and conditions have seemingly become worse as of late. Nonetheless, the week is starting off strong for oil, and that’s good for CHK, REN, and TPLM alike. Today, we’ll talk about the glimmers of hope that have been offered thus far this week and what we can expect to see from these stocks ahead.

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CHK, REN, And TPLM May All Benefit From Recent News Surrounding Oil

As mentioned above, the one thing that Chesapeake, Resolute Energy, and Triangle Petroleum have in common is the fact that they are focused on oil production. As a result of this, they are all heavily exposed to the oil spot market price, and that hasn’t been good as of late. However, so far this week, two big stories have sparked a bit of hope for the oil industry as a whole, and all three of these stocks may benefit. Here’s what’s going on…

Venezuelan President Says A Deal May Be Close

While there is a supply glut at play at the moment, the world’s oil producers haven’t been able to reach an agreement with regard to freezing production. As a result, producers have continued to increase production, only adding to the problem. However, according to a recent statement from the Venezuelan President, we may see a massive deal between OPEC and non-OPEC producers sooner rather than later. Here’s a snippet from what President Maduro had to say:

We had a long bilateral meeting with [Iran’s president Hassan] Rouhani. We’re close to a deal between OPEC producer countries and non-OPEC…”

This is massive news. After all, if a deal is met to freeze production levels, we won’t see more of an addition to the supply glut. Ultimately, this will allow for the demand for the commodity to catch up with the massive growth we’ve seen in supply in recent years. If this happens, CHK, REN, and TPLM are all likely to benefit, as the price of oil will likely climb dramatically.

Oil Supply Draw Realized In The United States

Another bit of good news for CHK, REN, and TPLM alike came out of the American Petroleum Institute (API) earlier today. In a report, the API said that the United States saw a draw in crude oil supplies in the amount of 7.5 million over the past week. It was expected that inventories would build by 2.3 million barrels. So, with supply starting in the other direction, investors are getting excited.

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What I’m Expecting To See Moving Forward

I will admit that recent news has been positive. However, I have to say that I remain bearish when it comes to the oil market as a whole. Of course, that includes Chesapeake Energy, Resolute Energy, and Triangle Petroleum. At the end of the day, the draw in inventories is something new, but by no means is it a trend. Trends are built over time. Also, OPEC and non-OPEC nations have been close to several deals, but have yet to actually come to an agreement. Until something actually does happen, I’m not pinning much hope on these discussions. Nonetheless, I will be keeping a close eye on developments, as any reduction in supply or possibility of a deal could signify a change to the outlook.

[Image Courtesy of Pixabay]

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