Global oil and gas company ConocoPhillips (NYSE:COP) is exploring a deal with Venezuelan oil company Petróleos de Venezuela SA (PdVSA), the WSJ reported. With this deal, ConocoPhillips will be able to sell Venezuela’s oil in the United States on behalf of PdVSA.
The move is viewed as part of ConocoPhillips’ efforts to recover the $10 billion that Venezuela owes it. The debt relates to the international arbitration awards that ConocoPhillips won against Venezuela and PdVSA as compensation for its three oil projects nationalized in 2007.
According to the report, ConocoPhillips is not currently planning to pump oil in Venezuela.
The easing of oil sanctions comes at a time when the global oil supply is tight due to the Russia-Ukraine war and OPEC is continuing to lock their production levels at 2 million barrels of oil per day. Furthermore, the reopening of China’s economy will probably lead to an increase in oil demand and further strain the oil supply.
Should You Buy COP Stock?
Wall Street is cautiously optimistic about the stock. COP stock has a Moderate Buy consensus rating based on 15 Buys, three Holds, and one Sell. The average stock price target of $143.78 suggests upside potential of 19.66%.
Also, hedge funds increased their holdings of COP stock by 4.4 million shares in the last quarter. Overall, ConocoPhillips scores a “Perfect 10” on TipRanks’ Smart Score rating system, pointing to its potential to outperform.
