It’s not enough just to extract oil. It also has to be properly converted to useful matter. Just ask oil stock Chevron (NYSE:CVX), who saw one of its key refineries go down for a bit. But its recovery also prompted a recovery in its share price, as Chevron is up fractionally going into the final minutes of Tuesday’s trading session.
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The refinery in question—the Richmond refinery not far from San Francisco—went down late Monday into early Tuesday following a power outage in the area. That led to “unplanned flaring” at the refinery, in which four smokestacks started spewing flame. This is actually something of a safety measure, reports note, as flaring allows for a means to burn off excess gases that might otherwise get released into the larger environment. Nevertheless, with the power back online, the refinery is likewise back up and running.
That’s Not All The Trouble for Chevron, Though…
This is actually part of a larger body of issues recently striking Chevron. For instance, just yesterday, Chevron saw its Kazakh oil output decline as a storm hit the Black Sea. Featuring not only hurricane-force winds but also both snow and rainfall, the storm brought strong flooding with it and substantial snowfall totals. That’s a combination that doesn’t make moving anything flammable a very good idea.
But there may also be some issues with the U.S. government coming up, as Chevron has been slowing up efforts to replace the Strategic Petroleum Reserve, reports note. The issue isn’t so much one of oil but rather of barrels. Reports note Chevron is being sluggish in its return of barrels borrowed from the reserve that were emptied previously. Now, they sought—and received permission to delay the return until at least 2024.
Is Chevron Stock a Good Buy Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on CVX stock based on 11 Buys and six Holds assigned in the past three months, as indicated by the graphic below. After a 16.6% loss in its share price over the past year, the average CVX price target of $182.12 per share implies 25.29% upside potential.
