Currently, the market is in upheaval in the wake of the global health scare of covid-19. This is causing the market to see some unpredictable situations and times. Certain industries are gaining while some are simply facing a lot of losses and downfall of the stock prices. One such industry that is facing some major downfall is oil and gas. Off late when the entire world is under lockdown due to the fast-spreading pandemic, the demand for oil and gas has reduced significantly. Due to this the price of the crude oil dipped majorly and that lead to the fall of the stock prices of the oil and gas companies like gush stock at https://www.webull.com/quote/nysearca-gush . Many investors chose to sell their stocks off, and the condition is not likely to change in the near future.
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Is it all bad news now? Well, not really, as the cities are starting to come out of the lockdown slowly. As the industries are working, vehicles are running and even the airlines are starting to resume their work, the demand for crude oil is increasing. This is making the price of the oil go up slowly.
So is it safe to buy oil stocks now? Well, experts are saying that buying the oil stocks should completely be optional and selective in manner. It should depend on the companies position in the market, the part of the industry it belongs to, etc. Also, the investors should spend their time analyzing the fundamentals of the firm, valuations, earnings, stock price, management efficiency, etc. as the choosing criteria.
Factors to look at
Factors like demand, supply, and inventory will decide whether the price of the oil will go up or not, and whether the price of the stocks will rise or not. One needs to check the market equilibrium for oil and what is the current stand of the oil price. As there is a lot of excess due to less demand for oil, the chances of the price moving toward equilibrium are high.
One needs to look out for those companies who can produce oil in low cots and low leverage with less debt like gush stock. They will be one who will be a major part of the market as the demand will slowly increase.
Investors need to keep themselves aware of the price of the oil and how the companies are performing. It is not just about the current performance or what they did last year. But it is about how they are coping with the crisis and what their performance is after the 1st quarter earnings. If you want to know more stock information like mro stock, you can visit at https://www.webull.com/quote/nyse-mro .