Why is the Woodside share price surging 4% on Thursday?

The Woodside Energy Group Ltd (ASX: WDS) share price is on the move this morning on no news.

At the time of writing, shares in the oil and gas giant are up 4.17% to $33.69 each.

In broader market moves, the S&P/ASX 200 Energy Index (ASX: XEJ) is 3.68% higher, spiking 2% immediately from the open today.

Let’s check what’s going on.

What’s up with the Woodside share price?

There are a number of factors impacting the Woodside share price today.

Futures on Brent Crude oil – the world’s oil pricing benchmark – have inched higher overnight to now trade at US$94.5/Bbl.

Meanwhile, European natural gas contracts [TTF EU Dutch gas] have gained around 10% overnight, and now trade back in line with their March 2022 peaks.

The latest gas price surge comes amid a dire forecast from the International Energy Agency (IEA). It now expects a lift in gas-to-oil switching for heating purposes, as gas prices continue to rocket heading into the European winter.

The IEA predicts this may provide some buoyancy to the oil price which, it predicts, will be hit by falling demand by the end of 2022.

According to reporting by Reuters, “The [IEA] expects the deepening economic slowdown and a faltering Chinese economy to cause global oil demand to grind to a halt in the fourth quarter of the year. That has kept prices under pressure of late, and may inhibit further rallies.”

Meanwhile, Woodside shares have been pushing north in an uptrend for most of 2022, lifting 53% year to date.

Chief to this year’s handsome gain has been the rising prices of oil and natural gas, with each commodity rocketing to multi-year highs at some point in 2022.

The Woodside share price has shot from 52-week lows of $21.27 on 20 December last year to a 12-month peak of $35.95 on 26 August. It’s dropped back in range so far this month.

But into today’s session so far, it looks to be a case of ‘trend is our friend’, as the saying goes, meaning the share is still attracting buyers at current prices.

And finally, analysts at Citi have upgraded their forecasts for liquid natural gas (“LNG”) and note that Woodside is “best placed” to benefit from the increase in spot prices.

“Due to fuel switching, impacts of high European natural gas and power prices have reverberated across the entire energy sector globally,” the broker also added.

It rates Woodside a buy with a $36.50 per share valuation.

Woodside shares are up 63% this year to date.

The post Why is the Woodside share price surging 4% on Thursday? appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• Why is the Woodside share price faring better than the ASX 200 today?
• 5 things to watch on the ASX 200 on Wednesday
• Up 50% so far this year, is it too late to buy Woodside shares?
• 5 things to watch on the ASX 200 on Monday

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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