Since the first of June, MRO has fallen 2.21% ending Friday off at $26.49. The drop in the stock price follows the news that OPEC will continue to maintain their target production level of $30 million dollars a day. With this being said, the U.S. continues to cut production levels, with the rig count being half of what it was at this time last year. Still, the U.S. has just passed Russia as the biggest oil and natural gas producer in the world, as congress considers legislation to permit the export of crude oil from the U.S. Another supply increase to look out for is the possibility of Iran producing gas again, as it is going to European energy giants asking for the $100 billion needed to rebuild its oil industry. However, Iran will not have a large effect on the global supply for a couple years.
Analysts covering MRO have an average price target of $34.00. I believe the stock should be held, as it still rests at 3.8% above the buy-in price. Analysts continue to upgrade the stock, and predictions for the next earning update keep looking better. Although oil prices have the possibility of falling, legislation allowing for the exportation of oil will be a big win for MRO.