Energy insiders reveal that the true cost of oil is far higher than what traders see on screens. While oil futures prices may show lower figures, the actual cost of purchasing and transporting physical oil is significantly steeper. For instance, chartering a supertanker from the U.S. Gulf Coast to China now costs around $76 million, up from $7.6 million a year ago. This premium translates to roughly $38 extra per barrel, indicating that the real price of oil could be $125 or more per barrel.
The surge in shipping costs is driving up the value of shipowner stocks. Companies involved in oil transportation are seeing substantial gains, reflecting the increased demand and higher prices for their services. Meanwhile, energy giants like Shell (SHEL) are benefiting from strong market positions and rising profits. Analysts highlight Shell's significant liquefied natural gas business, which is expected to see wider export margins due to European gas price trends.
Other energy stocks, such as ConocoPhillips (COP), are also gaining attention. RBC Capital Markets lists COP among its top global stock ideas, citing its strong balance sheet and peer-leading distributions. Analysts project over 20% upside for COP, with a target price of $152. Additionally, refiners like ExxonMobil (XOM) and Valero (VLO) are seeing revised earnings estimates higher due to a growing diesel and gasoline shortage.
In the renewable energy sector, First Solar (FSLR) is recommended as a buy, with a $270 target, due to favorable tariffs boosting pricing power. Meanwhile, TeraWulf (WULF) is noted for its potential upside, with a $21 target and expectations of a lease in Kentucky acting as a catalyst. The energy market remains dynamic, with various sectors showing strong growth potential.