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

Zacks Equity Research

For Immediate Release

Chicago, IL – July 15, 2019 – 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 ConocoPhillips COP, Exxon Mobil Corporation XOM, Royal Dutch Shell plc RDS.A and Chevron Corporation CVX.

Here are highlights from Friday’s Analyst Blog:

Oil Price Spurts as Tensions Intensify in the Strait of Hormuz

Energy traders are currently focusing on the confrontation of a Western warship with the naval forces of Iran, the first such hostility since the tensions between Washington and Tehran started mounting.

This isn’t surprising as Tehran had reportedly made threats that if its economy is hit by America’s sanctions, it will attempt to thwart the passage of oil tankers through the Strait of Hormuz, a major crude artery in the world. Among the new sanctions imposed by the United States on Iran over the past year, with Tehran claiming that it has started enriching the level of uranium above limits, some directly target the Asian country’s crude oil export. This has irked Iran as the country’s economy is heavily dependent on the export of the commodity.

UK Navy Targets Iranian Vessels

HMS Montrose, a British frigate, trained its guns on three ships of Iran after BP plc (BP)-operated British Heritage was supposedly intercepted in the Strait of Hormuz. British Heritage was coming from the Persian Gulf when Iranian boats tried to block the course of the crude tanker. Later on, the Royal navy ship forced Iranian ships to turn away.

Washington and London have been accusing Tehran of escalating assaults by the Islamic Revolutionary Guard of Iran on tankers carrying oil through the strait. However, news agencies of Tehran revealed that the Islamic Revolutionary Guard was not responsible for the attacks. 

How the Incident Favors Oil Price

The Strait of Hormuz is touted as the most important global passage for transporting crude. Per the U.S. Energy Information Administration (EIA), the Strait was responsible for the passage of 21 million barrel of oil every day in 2018. This accounted for an equivalent of 21% of the consumption volumes of petroleum liquids across the globe, added EIA.

Unlike most choke points, the passage of oil tankers through the Strait of Hormuz can’t be avoided by taking alternative routes, revealed EIA. Hence, the strike on several oil tankers in or near the Strait could lead to a further rise in shipping costs. This in turn acted as a catalyst for crude prices. While the West Texas Intermediate (WTI) crude recently traded at its highest level of $60.94 a barrel since May 23, Brent crude reached the highest mark of $67.65 since May 30.  

Time to Keep a Track of Oil Stocks

Since the fate of crude exploration and production companies is positively correlated with oil price, the recent rally in the commodity certainly bodes well for crude energy majors. Four such stocks are ConocoPhillips, Exxon Mobil Corporation, Royal Dutch Shell plc and Chevron Corporation, each with a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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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.

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