Continental Resources (CLR) will report Q1 earnings late Wednesday as the recovery in oil prices should bring back profits after four straight quarters of losses.
Estimates: Analysts see the U.S. independent oil producer swinging to a profit of 30 cents per share vs. a loss of 8 cents per share in the year-ago quarter as oil prices rebounded from early-pandemic lows. Revenue is seen rising 10% to $967.6 million.
Results: Check back after the close Wednesday.
Outlook: In February, Continental set a $1.4 billion capital expenditures budget. That was up from its preliminary budget in November of $1.2 billion-$1.3 billion. Annual oil production was expected at 160,000-165,000 bpd.
The U.S. shale company is the largest producer in the Bakken. It has also been aggressive recently in Oklahoma’s STACK and SCOOP shale plays.
But despite the rebound in oil prices, the U.S. shale sector is expected to be more subdued with production expansion plans compared to previous rallies. Top CEOs have acknowledged OPEC’s market power recently, and the oil group has downplayed the threat of shale.
“Drill, baby, drill is gone forever,” Saudi Energy Minister Abdulaziz bin Salman said in March during a post-meeting news conference.
Stock: Shares edged down 0.2% to 25.82 on the stock market today. Permian shale giant Pioneer Natural Resources (PXD) rose 0.5%. Exxon Mobil (XOM) shares rose 0.6%, and Chevron (CVX) edged up 0.4%. Both oil majors Exxon and Chevron will report first-quarter results on Friday.
Brent oil prices rose 0.7% to 66.11 per barrel. U.S. crude was up 0.9% to 62.44.
Risks To Oil Prices
Oil prices have come under pressure amid soaring Covid-19 cases in India, a top energy market. A terrible new surge is threatening to overwhelm the country’s medical system as new infections hit a fresh daily high of 350,000 on Monday.
“Downward revisions to India’s demand outlook are possible, as are growing risks in other non-OECD nations from continued Covid-19 outbreaks,” Wood Mackenzie analyst Ann-Louise Hittle said in a note Tuesday.
But she noted that U.S. demand is rising back toward pre-pandemic levels and that “a strong summer demand season is nearly certain with that nation’s vaccine progress over the last few months.”
Hittle said oil prices could fall if U.S.-Iran nuclear talks were successful and Iranian crude was allowed back on the global market. But she noted that the nuclear talks are “likely to take weeks longer” and OPEC+ could weigh the factor at its June meeting.
Follow Gillian Rich on Twitter for energy news and more.
YOU MAY ALSO LIKE: