Rising oil and natural gas prices have benefited the industry so far this year. However, the U.S. Energy Information Administration (EIA) expects continuing volatility and declines in current price levels. Given the oil market's uncertainties, the question is which stock—Camber (CEI) or Earthstone (ESTE)—is a better bet? Keep reading to find out.Camber Energy, Inc. (CEI) is a Houston, Tex.-based independent oil and natural gas company that acquires, develops, and sells crude oil, natural gas, and natural gas liquids in the Cline shale and upper Wolfberry shale Glasscock County, Texas. In comparison, Earthstone Energy, Inc. (NYSE:ESTE), which is based in The Woodlands, Tex., is also an independent oil and gas company that acquires, explores for, develops, and produces oil and natural gas properties in the United States.
Crude oil prices have rallied over the past year owing to steady draws on oil inventories and OPEC’s reluctance to raise its production levels. However, Brent crude futures dipped 69 cents to $84.09 a barrel on November 10 after the U.S. inventory report showed a rise in U.S. crude inventories by 1 million barrels in the most recent week.
The U.S. Energy Information Administration (EIA) expects Brent prices to decline from current levels to an annual average of $72/b in 2022. Furthermore, the organization forecasts that retail gasoline prices will average $3.32/gal in November and then decline to $3.16/gal in December. In contrast, natural gas prices are expected to remain at current levels through year’s end. However, prices are expected to be volatile due to uncertainty around seasonal demand. So, let’s compare CEI and ESTE to see which is fundamentally more stable and better equipped to withstand the potential volatility.