Oil & Gas Stock Roundup: BP and Diamondback Unveil Q1 Highlights

It was a week when oil prices jumped broke its losing streak, while natural gas futures continued the southward journey.  

The headlines revolved around oil biggies BP plc BP and Diamondback Energy’s FANG Q1 earnings updates. Developments associated with Venture Global VG, NextDecade Corporation NEXT and Chevron CVX also grabbed attention.

Overall, it was a mixed seven-day period for the sector. West Texas Intermediate (WTI) crude futures increased more than 5% to close at $64.68 per barrel, but natural gas prices fell almost 8% to end at $3.249 per million British thermal units (MMBtu).

The crude price gain was mainly driven by a weaker U.S. dollar, which makes oil cheaper for global buyers. Tighter U.S. sanctions on Iranian oil also added pressure on supply, supporting prices. Additionally, signs that U.S. trade tensions may be easing gave the market a boost. OPEC+ also played a role by adjusting its output plans, asking members who produced more than agreed upon to cut back now, helping to balance supply.

Meanwhile, the drop in natural gas prices can be linked to persistent concerns about soft near-term demand and record-breaking production levels.

Recap of the Week’s Most Important Stories

1.    BP, the UK-based energy major, expects weak first-quarter 2025 results for its natural gas trading business, signaling a challenging start to the year as it shifts its focus back to traditional oil and gas operations.

In a quarterly trading update released on Friday, the company said that the overall upstream production would be lower compared to the prior quarter. While oil production is expected to rise slightly, gas and low-carbon energy output will be lower, reflecting recent divestments in Egypt and Trinidad that closed late last quarter.

The weak performance in natural gas trading stands out in a quarter that is otherwise expected to deliver an “average” result for BP’s oil trading division. BP noted that oil and gas realizations are likely to remain broadly flat on a sequential basis. The Zacks Consensus Estimate for BP’s first-quarter earnings is pinned at 64 cents per share, down from 97 cents in the prior-year quarter. (BP Expects Lower Gas Output & Higher Debt in Q1 Amid Strategy Shift)

2.    Diamondback Energy recently released its operational update for the first quarter of 2025 to strategically pursue its stock repurchase plan in light of ongoing market volatility.

The Zacks Rank #3 (Hold) shale explorer reported an average oil production of 475.9 thousand barrels of oil per day, while combined output was 850.7 thousand barrels of oil-equivalent per day. The company also achieved average unhedged realized prices of $70.95 per barrel of oil, $23.94 per barrel of natural gas liquids and $2.11 per thousand cubic feet of natural gas.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Key financial metrics for the quarter include a total derivative gain of $226 million, driven by an $85 million realized hedge gain and a $141 million unrealized gain. Capital expenditures totaled $942 million. Demonstrating its commitment to shareholder returns, the company repurchased more than 3.6 million shares in the first quarter for $575 million at an average price of $157.15 per share. Diamondback also reported an average of 289,612 basic and diluted shares outstanding at the end of the first quarter. (Diamondback Releases Key Operational Highlights for Q1 2025)

3.    Natural gas exporter Venture Global announced that it has begun commercial operations at the Calcasieu Pass liquefied natural gas (LNG) facility on April 15, 2025. The company has also started supplying U.S. LNG to the project’s long-term customers. The Calcasieu Pass LNG export facility consists of mid-scale, modular liquefaction trains and supporting infrastructure that enable the plant to process natural gas for transportation.

The plant began exporting LNG cargoes in March 2022, and by September, it was operating at full capacity. However, Venture Global mentioned that the plant faced technical issues due to which many long-term customers did not receive their contracted LNG cargoes. These customers include energy giants like Shell, BP, Repsol and Edison who then began arbitration proceedings against VG, with the collective claims adding up to approximately $5.4 billion. The customers alleged that Venture Global intentionally delayed its contractual obligations and instead sold LNG at spot rates to capitalize on the higher prices.

VG mentioned that the Calcasieu Pass LNG project has suffered major setbacks, including a global pandemic that is likely to have caused supply-chain issues and delayed the timeline of the project, along with two hurricanes. The plant was also affected by a force majeure event associated with a manufacturing issue in the plant’s power island. (Venture Global's Calcasieu Pass Facility Enters Commercial Operations)

4.    U.S.-based LNG developer NextDecade recently inked a long-term LNG supply agreement with TotalEnergies Gas & Power North America, a subsidiary of TotalEnergies. Per the terms of the agreement, TotalEnergies will purchase 1.5 million tons per annum (MTPA) of LNG for 20 years on a free-on-board basis at a price indexed to the Henry Hub’s benchmark price.

Since TotalEnergies has been a major contributor to the success of Rio Grande LNG Phase 1, NEXT is pleased to expand its partnership with TTE through the execution of this Train 4 agreement.

Rio Grande LNG is the largest privately funded LNG project in Texas, situated on a 984-acre site at the Port of Brownsville. The project benefits from its proximity to the Permian Basin and Eagle Ford shale, ensuring a steady supply of natural gas with minimal weather disruptions compared to other locations on the Gulf Coast. (NextDecade Secures LNG Sale and Purchase Deal From TotalEnergies)

5.    U.S. supermajor Chevron, along with several other multinational energy firms, has exited its oil concession blocks in Egypt’s Red Sea region after failing to discover commercial oil or gas reserves.

Despite making substantial investments over and above their commitment, one company, which reportedly spent $34 million against an initial commitment of 10 million, did not find any viable resources. As a result, Chevron renounced 45% of its stake in Red Sea Block 1, located in the northern Red Sea. The block is jointly held by Chevron and Australia-based oil giant Woodside Energy Group.

Chevron is not moving back from Egypt completely but rather redirecting its focus. The company has expressed interest in three new exploration blocks, including two in the Mediterranean, where it will operate alongside partners such as Shell and Woodside Energy. Shell and Chevron have applied for new concessions in the region, reaffirming their long-term commitment to Egypt’s energy landscape. (Chevron Exits Egypt's Red Sea Blocks, Eyes Mediterranean Prospects)

Price Performance

The following table shows the price movement of some major oil and gas players over the past week and during the last six months.

Company    Last Week    Last 6 Months

XOM              +3.7%             -10.2%
CVX               +1.7%             -9.1%
COP               +3%               -13.9%
OXY               +5.4%            -22.5%
SLB                +3.4%            -17.5%
RIG                +0.9%             -47%
VLO               -0.6%              -12.9%
MPC              +3.5%             -12.2%

With oil in the green for the week, stocks made a beeline north. The Energy Select Sector SPDR — a popular way to track energy companies — went up 3.3% last week. But over the past six months, the sector tracker has gone down 9.6%.

What’s Next in the Energy World?

Market participants will keep a close eye on regular data releases to gauge the direction of commodities. U.S. government statistics on oil and natural gas, one of the most reliable indicators, will be a key focus for energy traders. Fuel demand and stock drawdowns in the coming weeks will shape commodity price trends. Additionally, Baker Hughes' rig count data, a critical indicator of U.S. crude and natural gas production trends, is also closely monitored. Tariff-related developments will also be a key factor in determining price trends. Finally, there will be 2025 Q1 earnings, with some S&P 500 companies reporting quarterly results.

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This article originally published on Zacks Investment Research (zacks.com).

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