Energy stocks gain while ASX falls
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The news: Energy was the only sector in green by afternoon trading on the ASX, with Beach Energy buoyed by an upgrade from Macquarie analysts, Karoon Energy rising on fresh drilling approvals in the US Gulf of Mexico, and Boss Energy gaining on its uranium update.
The numbers: By 1:23pm AEDT, the energy sector was up 0.32% while the ASX 200 dropped 1.27%. Beach Energy (0.94%), Boss Energy (1.11%), Karoon Energy (0.69%) were among the biggest movers among the large energy companies.
The context: Australian energy majors were boosted by increasing oil prices, after Ukrainian attacks on Russian energy facilities and the escalating conflict in the Middle East pushed the benchmark to their highest level since October.
Elsewhere, Macquarie analysts upgraded their target price for Beach Energy from $1.95 to $2.05. They noted that with the progression of its strategic review, including the recent announcement of a 30% headcount reduction, capital expenditure should halve in the 2025 financial year.
Meanwhile, Karoon's share price climbed after the Melbourne-based company received approval to drill in the Who Dat East and South exploration wells in the US Gulf of Mexico. As part of a joint venture with LLOG and Westlawn, Karoon said the total cost of the project is expected to be USD67 million to $US77 million ($103 million to $118 million) net to the company.
Shares in Boss Energy also increased after it announced that it had passed the final technical milestone in its "honeymoon re-start strategy". Boss acquired the Honeymoon Uranium Project in 2015, and said it expects to fill the first drum of uranium at the South Australian mine within the next fortnight.
The sources: ASX announcement, ASX announcement, Macquarie research
