Key points:
- Hurricane Energy’s share price has fallen 41.7% in 3 months.
- The decline also coincided with a decline in crude oil prices.
- So what comes next for HUR shares? Read on to find out.
The Hurricane Energy PLC (LON: HUR) share price has fallen 41.7% in three months after hitting new highs in March. The stock retested the highs in late March and mid-April before falling significantly after that.
The offshore oil company’s share price decline can be partly attributed to the pullback in oil prices, but there are other factors contributing to the HUR share price decline. The company’s Lancaster oil field is expected to run out of oil reserves soon.
Also read: Best Oil Stocks To Buy Right Now.
Lancaster was estimated to have oil reserves of up to billions of barrels in the past. Still, these estimates were discarded in 2021 after it emerged that the oil reserves at the offshore location were a mere fraction of what was initially expected.
Hurricane Energy almost collapsed after the new estimates were released. Still, the resignation of the management team breathed new life into the company as the team that took over remained focused on streamlining its operations and repaying the debt owed to bondholders.
The UK North Sea oil company is on track to complete all the outstanding bond payments without the risk of going bankrupt. The firm has been consistently profitable since the new managers took over, and this is expected to continue until the Lancaster oil field is decommissioned.
Hurricane Energy has not made any new announcements in July, with its last press release revolving around the AGM meeting at the end of June. However, investors eagerly look forward to future announcements before deciding whether to buy or sell HUR shares.
Meanwhile, I will wait for the company’s subsequent operations update to determine whether I should buy HUR shares. I will look for the oil reserve estimates and the company’s performance during the second calendar quarter of 2022.
Meanwhile, I will adopt a wait-and-see approach toward the oil firm.
*This is not investment advice. Always do your due diligence before making investment decisions.
Hurricane Energy share price.
The Hurricane Energy share price has fallen 41.74% in three months but is still up 67.7% for the year.
