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Highlights
- The UK has been gripped by soaring gas prices caused by lower reserves, lower wind output, higher demand and other factors
- Oil prices also rose on 1 October, after OPCE+ decided to increase its output to ease a global tight supply of oil.
The UK has been facing an energy crisis recently as wholesale natural gas prices have risen to record highs.
The gas supply shortage has been attributed to a number of factors, including low supplies from Russia, a low wind output in the months of August and September, global demand recovery and low reserves ahead of a winter season which is expected to exacerbate the situation.
Gas prices rose over 3 times in the month of September, compared to any other September in the past decade. Moreover, the lifting of the energy price cap that came into effect from 1 October is expected to increase energy prices by US$ 190 more this year for British households.
Let us take a look at the top 5 FTSE listed stocks in the oil and gas sector which have given shareholders a one-year return of over 130 per cent:
- Zephyr Energy PLC (LON:ZPHR)
FTSE AIM All-Share index listed firm Zephyr Energy is a Rocky Mountain focused oil and gas company.
The firm released its H1 2021 results on 30 September, reporting the drilling of its State 16-2LN-CC well in its Paradox project based in Utah at a total depth of 14,370 feet.
It also raised £10 million in capital from a fundraise in April in order to fund its Paradox project’s drilling operations and also acquire non-operated assets.
Zephyr Energy has a market cap of £ 78.12 million, and its one-year return stands at 902.50 per cent as of 1 October 2021.
- Great Eastern Energy Corporation Ltd (LON:GEEC)
Great Eastern Energy Corporation is an integrated gas production company.
The company had reported a revenue of US$ 26.30 million in FY 2021, compared to US$ 36.25 million in FY 2020.
It’s FY 2021 earnings before interest, tax, depreciation and amortisation (EBITDA) stood at US$ 13.65 million, compared to US$ 20.95 million in the previous year.
While the pandemic impacted its sales, its average gas sales prices helped in supporting the company to remain profitable during the period.
The company expects an annual saving of about US$ 0.50 million in the current fiscal, FY 2022, due to its focus on optimising its debt coupon rate.
Great Eastern Energy Corporation has a market cap of £ 36.33 million, and its one-year return stands at 278.41 per cent as of 1 October 2021.
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- 88 Energy Limited (LON:88E)
FTSE AIM All-Share index constituent 88 Energy is an Australia based oil and gas exploration company.
The company raised a gross amount of AU$ 23.96 million in a share placing on 2 September. The net proceeds from the capital raise will be used to boost its balance sheet as well as help in funding the Merlin-2 appraisal well in Q1 2022.
88 Energy has a market cap of £ 207.06 million, and its one-year return stands at 315.36 per cent as of 1 October 2021.
- I3 Energy PLC (LON:I3E)
I3 Energy is an independent oil and gas company and is also part of the FTSE AIM All-Share index.
The company released its H1 2021 results recently, reporting net revenue of £26.5 million, while its H1 2021 net operating income stood at £12.5 million for the period. It also declared an H1 2021 dividend of 0.2 pence per share, with an ex-dividend date of 7 October.
I3 Energy has a market cap of £ 154.18 million, and its one-year return stands at 237.42 per cent as of 1 October 2021.
- Enquest PLC (LON:ENQ)
FTSE All-Share index constituent Enquest is a UK based independent petroleum exploration and production company.
The company recently reported its H1 2021 results. Its production for the period stood at 46,187 barrels of oil equivalent per day (boepd), compared to 66,055 boepd in H1 2020.
Also, its H1 2021 revenue and other operating income increased by 15.2 per cent to US$ 518.3 million, from US$ 450.0 million in H1 2020. Higher oil prices helped offset the company’s lower production output during the period.
Enquest has a market cap of £ 447.91 million, and its one-year return stands at 132.64 per cent as of 1 October 2021.
Bottom Line
Firming oil and gas prices have offered shareholders of these stocks hefty returns in the past one year, however investors keen to invest in the oil and gas sector should keep track of how macroeconomic factors such as the global supply and demand curve will be impacting the sector along with company-specific news prior to investing.
