With oil prices expected to gush higher, it’s time to buy pullbacks in oversold oil giants.
For one, Russia is expected to cut its supply by 500,000 bpd in March. All after imposed price caps on Russian oil and oil products. Two, with China reopening, oil demand is set to spike. In fact, according to JP Morgan, as quoted by Reuters, “China’s economic recovery will drive its demand for commodities higher, with oil positioned to benefit the most.”
One way to trade the potential for higher prices is with oversold shares of Chevron. Not only is it oversold at double bottom support – with over-extensions on RSI, MACD, and Williams’ %R – the company just hiked its share buyback program to $17.5 billion.
“It also raised its share buyback guidance to a range between $10 billion and $20 billion per year. It was able to do so because it expects annual free cash flow growth of more than 10% with oil prices at $60 a barrel. It reaffirmed that it expects to increase production by 3% a year on average through 2027,” according to Barron’s.