Leading energy infrastructure company Kinder Morgan’s (KMI) strategic acquisitions to diversify its portfolio of natural gas assets have strengthened its position in the energy market. However, because the spread of the COVID-19 Delta variant continues to stoke fears around future energy demand, the stock’s near-term prospects look uncertain. Let’s discuss.Houston, Tex.,-based energy infrastructure company Kinder Morgan , Inc. (NYSE:KMI) specializes in owning and controlling oil and gas pipelines and terminals in North America. The company owns and operates approximately 83,000 miles of pipelines and 144 terminals. So far this year, the stock has gained 27.1%, driven primarily by higher contributions from all three of its business segments in the second quarter of 2021 relative to the second quarter of 2020. Also, greater demand for natural gas transportation and storage contracts in Texas has helped the company generate robust sales in the last reported quarter.
However, its stock is down 4% over the past month. This can be attributed primarily to volatility in oil prices as the Organization of the Petroleum Exporting Countries and other producers, including Russia—collectively known as OPEC+—reached an agreement to boost oil supply to cool oil prices and meet rising demand.
Although KMI’s diversified portfolio and its plans to acquire a leading supplier of liquefied natural gas in the Midwest should help it stand out in the energy market, concerns related to the spread of the COVID-19 Delta variant and its potential reduce energy demand could cause KMI’s shares to retreat in the near term.