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Given the rising demand for crude oil on the back of the reopening global economy, oil prices have rallied more than 45% in the first half of 2021 and are likely to hit the $80 per barrel mark soon. Declining inventories amid tight production should allow oil prices to rise further. Current inventory levels are expected to decline by another 100 million barrels by the end of this year to well below pre-pandemic levels. According to Wall Street analysts, oil prices might reach triple digits by next summer.
Thus, we think lesser-known oil exploration companies ARC Resources Ltd. (AETUF), California Resources Corporation (CRC), SilverBow Resources, Inc. (NYSE:SBOW), and Goodrich Petroleum Corporation (NYSE:GDP) should benefit significantly in the coming months.
