5 Oil Stocks That Were Crushed This Week

The price of oil slipped again this week, closing at just over $37 per barrel. That sent oil stocks on a downward spiral, with

several slumping by double digits. The worst performers, according to S&P Capital IQ data, were Oasis

Petroleum (NYSE: OAS), Whiting Petroleum (NYSE: WLL), EP Energy (NYSE: EPE), Parker Drilling (NYSE:

PKD), and Carrizo Oil & Gas (NASDAQ: CRZO). 

What:Oasis Petroleum (NYSE: OAS) dropped 10% this week.

So What: Key driver: Oil price

volatility Oil is currently well below

Oasis Petroleum’s $50 cash flow break-even point

Now What: The concern is that oil

prices will continue to weaken, which would materially weaken Oasis’ financial situation

Key takeaway: Investors are growing concerned that Oasis’ balance sheet will begin to deteriorate

What:Carrizo Oil & Gas (NYSE: CRZO) fell more than 10% this week.

So What: Key driver: Oil price

volatility Only 55% of the

company’s drilling locations are economic at oil below $45 per barrel

Now What: The company needs

higher oil prices to drill economic wells

Key takeaway: Investors are concerned that Carrizo will have to drill uneconomic wells just to maintain its current production rate

What:Whiting Petroleum (NYSE: WLL) slumped more than 11% this week.

So What: Key driver: Oil price

volatility Like Oasis Petroleum,

Whiting is banking on a $50 oil price in 2016 to keep the company at cash flow break-even

Now What: The longer the oil price

stays low, the deeper Whiting’s cash flow deficit will grow

Key takeaway: The company needs oil prices to rise in order to keep its head above water in 2016

What:

EP Energy (NYSE: EPE) fell more than 12% this week.

So What: Key driver: Oil price volatility Oil prices have now slipped

below EP Energy’s break-even point of $41 per barrel in the Wolfcamp and is dangerously close to its $36 per barrel break-even point in the Eagle Ford and Altamont

Now What: Unless oil prices rally, EP

Energy will lose money drilling new wells

Key takeaway: Investors are concerned that EP Energy will drill uneconomic wells just to maintain its production level

What:Parker Drilling (NYSE: PKD) plunged more than 18% this week.

So What: Key driver: Oil price

volatility With oil at or below the

break-even point of many drillers, it means that fewer wells will be drilled than previously expected

Now What: A further slowdown in oil-

field activity would result in less revenue for a drilling contractor like Parker Drilling

Key takeaway: Investors worry that Parker might not have much work in 2016

This could be the next billion-dollar iSecret