Down 15% in a month, could rate hikes bring more pain for the Beach Energy share price?

The Beach Energy Ltd (ASX: BPT) share price has descended 15% in the past month, but could rate rises impact the company’s shares even further?

Beach Energy shares have slid 15% since market close on 26 August to $1.49, including a gain of 1.36% so far in today’s trade.

Let’s take a look at the outlook for the Beach Energy share price.

What’s ahead for the Beach Energy share price?

Beach Energy shares may have fallen in the last month, but they are not alone among ASX oil shares. The Santos Ltd (ASX: STO) share price has fallen nearly 12% since market close on 26 August, while Woodside Energy Group Ltd (ASX: WDS) shares have slid 14%.

Looking ahead, multiple factors, including interest rate rises, the strong US dollar, and the Russian and Ukraine war, could weigh on the oil price.

Interest rate rises by central banks around the world could lower oil demand, an analyst quoted by Reuters suggested. Oanda senior market analyst Craig Erlam said:

With more and more central banks being forced to take extraordinary measures no matter the cost to the economy, demand is going to take a hit which could help rebalance the oil market.

Meanwhile, the strong US dollar is also impacting commodities, including oil, analysts quoted by the publication noted. Oil is priced in the US dollar.

Mizuho energy futures director Bob Yawger said: “It’s hard for anyone to expect oil will recover in the wake of a greenback this expensive.”

However, on the contrary, some analysts are optimistic the oil price will recover in the long term if supply tightens amid Russia’s war with Ukraine. Moody Analytics chief economist Mark Zandi, quoted by Forbes, said:

Oil prices are sure to come under renewed upward pressure as the European Union prepares to implement its sanctions on Russian oil in the coming months.

Energy Aspects chief oil analyst Amrita Sen highlighted in the Australian Financial Review on Friday there are “too many different and contradictory factors driving prices”.

She said: “This is going to be a very, very volatile last quarter.”

Share price snapshot

Beach Energy shares have soared 20% in the past year. In the year to date, they have risen 17%, but have fallen 8% in the past week.

Beach Energy has a market capitalisation of more than $3.4 billion based on the current share price.

The post Down 15% in a month, could rate hikes bring more pain for the Beach Energy share price? appeared first on The Motley Fool Australia.

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Motley Fool contributor Monica O’Shea 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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