The Zacks Analyst Blog Highlights: BP, Exxon Mobil, Royal Dutch Shell, Chevron and PetroChina - - Columbia, South Carolina |

The Zacks Analyst Blog Highlights: BP, Exxon Mobil, Royal Dutch Shell, Chevron and PetroChina

Information contained on this page is provided by an independent third-party content provider. WorldNow and this Station make no warranties or representations in connection therewith. If you have any questions or comments about this page please contact

SOURCE Zacks Investment Research, Inc.

CHICAGO, June 16, 2014 /PRNewswire/ -- announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the BP plc (NYSE:BP-Free Report), Exxon Mobil Corp. (NYSE:XOM-Free Report), Royal Dutch Shell plc (NYSE:RDS.A-Free Report), Chevron Corp. (NYSE:CVX-Free Report) and PetroChina Co. Ltd. (NYSE:PTR-Free Report).

Zacks Investment Research, Inc.,

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Friday's Analyst Blog:

Crude Rallies on Iraq Conflict: Oil Stocks in Focus

Oil prices rose to their highest level in nearly nine months on Thursday, as tensions over Iraq continued to feed supply concerns in the Middle East. In New York, West Texas crude was up 2% to close at $106.53 per barrel, rising above the $106 threshold for the first time since Sep 2013.

The Trouble

Since Tuesday, the al-Qaeda connected Sunni militant group – the Islamic State in Iraq and Syria (ISIS) – has captured three key towns in northern Iraq: Mosul - the country's second-largest city, Tikrit, and Baiji - where Iraq's biggest oil refinery is located. What's more, the insurgents, who want to establish their own state in Iraq and Syria, are reportedly pushing toward the capital city of Baghdad.

Worryingly, the Iraqi security has been weak in the face of these attacks and ineffective in maintaining order. In fact, officials said that forces from Iraq's autonomous Kurdish region took control of the northern oil hub of Kirkuk to protect it from jihadist attack after  government's  troops  failed  to  secure  the  area  and  abandoned  their  posts.

Country's Economic Turnaround at Stake?

Just when things were starting to look up from decades of instability, the stunning advance of the Sunni militants threatens to plunge Iraq back into a state of violence and chaos. This not only disrupts the country's budding economic growth – during which it became the second-largest oil producer in OPEC after Saudi Arabia – but also poses the risk of disintegration for the fragile nation.     

Impact on Crude Prices

Till now, the uprising is limited to the northern part of the country, while Iraq's production region in the south remains largely unscathed. However, there are fears that the instability could eventually move to the southern part, where most of Iraq's oilfields and export facilities are located.     

Predictably, the threat to oil supplies from a major producer has impacted prices in a big way.

The Stakeholders

The rebound in Iraq's crude production has happened with the help of international oil companies including BP plc (NYSE:BP-Free Report), Exxon Mobil Corp. (NYSE:XOM-Free Report), Royal Dutch Shell plc (NYSE:RDS.A-Free Report) and Chevron Corp. (NYSE:CVX-Free Report). Though Iraq operations make up only a small portion of these majors' global output, exploration and development has been ongoing.

Let's take a closer look at how the big energy companies are exposed to Iraq:

British major BP has a 38% working interest in the flagship Rumaila oilfield in southern Iraq. Counted as one of the top five oilfields in the world, Rumaila is estimated to hold reserves of nearly 18 billion barrels and currently produces the majority of Iraq's total daily output of around 3.5 million barrels. However, BP's share of output from Iraq is immaterial to its total daily production of more than 2 million barrels.

U.S. behemoth Exxon Mobil has roughly 900,000 acres of onshore leasehold land in Iraq. The company also possesses development wells in the country's West Qurna field, another big facility that holds approximately half the proved reserves of Rumaila. Exxon Mobil, which sold all but 25% of its stake in the field to Chinese energy giant PetroChina Co. Ltd. (NYSE:PTR-Free Report) and Indonesia's Pertamina in 2013, gets paid $1.90 per barrel for each one it produces above 244,000 barrels a day.

Europe's largest oil company Royal Dutch Shell holds a 45% operated interest in the giant Majnoon field, located in Basra province in Southern Iraq. With about 12.6 billion barrels in proved reserves, production was restarted from the oilfield in September last year. Volumes averaged 210,000 barrels a day, when Shell achieved first shipment from the development in Apr.

Chevron – the second-largest U.S. oil company by market value after Exxon Mobil – holds an 80% operated interest in the development-stage Qara Dagh block in Kurdistan region of Iraq. However, due to its involvement with the Kurdish regional government, Chevron has been barred from bidding on projects in the rest of Iraq

The Verdict

In the short run, higher oil prices over the Iraqi crisis will benefit the upstream divisions of BP, Exxon Mobil, Shell and Chevron. But in the long run, if the conflict escalates and crude keeps on climbing, at some point the overall economic activity will be hurt, which can't be good news even for the biggies. Moreover, escalating tensions in Iraq will mean lost opportunities in the region, and eventually a setback to their growth prospects.

Considering the uncertainties associated with the abovementioned Zacks Rank #3 (Hold) stocks, we advise investors to play safe and wait for a better entry point before accumulating shares.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today.

About Zacks is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros.  In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros.

Get the full Report on BP - FREE

Get the full Report on XOM - FREE

Get the full Report on RDS.A - FREE

Get the full Report on CVX - FREE

Get the full Report on PTR - FREE

Follow us on Twitter:

Join us on Facebook:

Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.

Media Contact
Zacks Investment Research
800-767-3771 ext. 9339

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit for information about the performance numbers displayed in this press release.

Logo -

©2012 PR Newswire. All Rights Reserved.

Powered by WorldNow