Why is the Woodside share price surging ahead on Monday?

The Woodside Energy Group Ltd (ASX: WDS) share price is rising again, up by 3.66% so far today.

This compares to the S&P/ASX 200 Index (ASX: XJO) which is currently only 0.04% higher, so Woodside is delivering sizeable outperformance today.

It’s a strong day for ASX shares involved with producing energy for the global market. The Santos Ltd (ASX: STO) share price is currently up around 3% while the Whitehaven Coal Ltd (ASX: WHC) share price is 7.65% higher at the time of writing.

It comes as the war in Ukraine rumbles on and Russian energy flows are still being disrupted, for one reason or another.

As reported by various global media, including the BBC, Russian gas giant Gazprom announced an “indefinite extension to a three-day maintenance halt to flows of gas through the continent’s key energy artery, hours after leading western finance ministers vowed to escalate sanctions on Russian oil”.

The reason Gazprom gave was that an oil leak had been discovered and that the pipeline cannot work without German imports of technology, which are currently blocked due to the trade sanctions.

Rising energy prices

As a commodity business, Woodside generates its revenue, and particularly its profit, based on how much money is paid for its resources. This also has a direct impact on the Woodside share price.

Higher prices obviously help Woodside make more money.

As reported by Commsec, overnight the Brent oil price increased by 0.7% to US$93.02 per barrel of oil equivalent.

That’s just one day’s movement, but higher energy prices are helpful for the ASX oil share.

Asset sale?

There’s another factor that may be making an impact on the Woodside share price today.

According to reporting by The Australian, Woodside may decide to pursue divestment of an oil and gas joint venture in the Gippsland Basin that was previously owned by BHP Group Ltd (ASX: BHP). It’s now owned by Woodside after the merger of BHP’s petroleum assets, completed in June.

Woodside is strategically reviewing its portfolio “holistically”, ensuring that it is focusing on the “highest priority opportunities”.

According to reporting, BHP hired Goldman Sachs around two years ago to consider selling oil assets, which included a possible sale of the Gippsland Basin assets in the Bass Strait. Some time ago, these assets may have been valued at around US$2 billion. But “large remediation costs have always been an impediment”, according to the report.

Woodside share price snapshot

Over the last month, Woodside shares have gone up around 12%.

The post Why is the Woodside share price surging ahead on Monday? appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Monday
• Are ASX 200 energy shares a good investment right now?
• Why is the Woodside share price sliding this week?
• ASX 200 shares declared $42b of dividends in August. Here’s how you can get a slice
• 5 things to watch on the ASX 200 on Friday

Motley Fool contributor Tristan Harrison 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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