WTI over $74 At these prices, most Canadian oil companies become cash cows. Unfortunately, most of them have about 50 % of their production hedged at very low prices for 2021.
In about six months those hedges will expire and oil companies will be raking in cash and paying down their debt.
Most oil stocks have done very well and have multiplied from their bottom. But they are still not pricing in the current $74 WTI prices and the true impact of FCF that they will generate. The oil price predictions are all over the place. OIl sentiment is improving provided OPEC does not mess with production.
Some institutional investors are still on the sidelines and have not invested oil sector others are underweight. The herd is busy with risky products. When the herd starts to chase the oil sector that would be the time to start shedding the oil stocks.
