Investors have sent shares in European oil exploration and production (E&P) focussed companies like Premier, Tullow, EnQuest and Faroe, soaring, and some fund managers say they have not peaked yet.
Shares in smaller and mid-cap British oil companies are outperforming the London FTSE blue chip index and their larger competitors, riding the wave of rising oil prices much higher than oil majors. “The sector has performed quite well, but not as well as it might have done, we’ve only just started the rally,” said Paul Mumford, senior fund manager at Cavendish Asset Management, who is invested in Faroe, EnQuest, Tullow, Hurricane Energy and Cairn Energy and other smaller E&P groups.
“I tend not to do majors. You’re not going to make ten times your money with BP and Shell, whereas with some of the (smaller companies) you will do that. It’s a very interesting undervalued part of the market.”
Smaller E&P companies have direct exposure to oil prices, reflected in benchmark Brent futures which have risen by around a quarter towards $80 a barrel in the past three months, levels last seen in late 2014. Read More
Latest posts by ET Energy World (see all)
- In pre-poll sop, government slashes GST on 100 mass-use items - July 22, 2018
- Saudis pump more crude oil for Trump, then doubt if it’s needed - July 22, 2018
- Fuel price hike: 2.5 lakh goods vehicles off roads in protest in Telangana - July 21, 2018