Oil-refinery shares soar as hurricanes hit US Gulf coast
Oil-refinery shares rose in response to news of hurricanes Marco and Laura recently hitting the US coast on the Gulf of Mexico, experts said.
An analyst at CGS-CIMB Securities (Thailand) said this may be the best time to buy shares in oil-refineries, such as Thai Oil (TOP), Star Petroleum Refining (SPRC), Esso (Thailand) (ESSO), PTT Global Chemical (PTTGC) and IRPC, for short-term speculation.
“The hurricanes forced oil firms to evacuate employees from 114 out of 643 oil rigs and also cut down on the production of oil and natural gas by 57.6 per cent and 44.6 per cent, respectively,” the analyst said.
“The cost of refining oil will be high for a while in the wake of the hurricanes, which can be seen in the increase of fuel prices yesterday.”
Meanwhile, Jakapong Chawengsri, senior director at Kasikorn Securities said, if the hurricanes had hit the Texan capital of Houston directly, the cost of refining oil would have risen sharply.
“Oil refinery stocks that would gain the most benefit SPRC and ESSO because these companies have a lot of petrol, and the demand for petrol in the US is very high, so we recommend buying their shares for short-term speculation,” he said.
“However, oil refinery shares will be pressured from an excess in supply next year.”
