- Citigroup cuts price target on U.S.-based oil and gas companies as challenges for the energy sector carry over into 2025
- Brokerage sees no scope for OPEC+ to reverse production cuts in 2025, leaving an est. 8 mln barrels per day (mbpd) of global oil market capacity on the sidelines
- Says “while we expect OPEC+ to stick to its current strategy and keep this oil out of the market, capacity excess means there is neither need for commodity price nor asset price (equities) inflation”
- “2025 shouldn’t look any different – the oil market will still be in overcapacity – unless the sector finds valuation support” – Citigroup adds
- However, brokerage upgrades oil major Chevron to “buy” from “neutral” and raises PT to $185 from $145; sees upside from Hess merger arbitration in 2025
| Company | New PT | Old PT | Upside to Stock’s Last Close |
|---|---|---|---|
| APA Corp | $24 | $29 | 6% |
| Devon Energy | $48 | $55 | 25% |
| Ovintiv | $54 | $55 | 18% |
| Occidental Petroleum | $56 | $57 | 11% |
(Reporting by Pooja Menon in Bengaluru)