Energy shares have risen and fallen on international and political extremes. In the latest unpredictable event, the International Energy Agency last week said it will release oil reserves to increase supplies, which sent down the price of crude by 8% over two days in London trading.
Energy stocks are down 8.5% over the past three months but have a 4% gain this year, according to Morningstar. Investors have unloaded riskier assets, such as energy, technology and securities in emerging markets, as global economic growth slowed and the U.S. central bank ended its bond-buying stimulus program.
Just yesterday, the Conference Board's sentiment index said U.S. consumer confidence fell to a seven-month low in June on worries about high unemployment and a sluggish housing market.Still, the central bank has said the economy faces only a temporary slowdown in economic growth. That view is shared by others, including Goldman Sachs rival Morgan Stanley. To be sure, Goldman Sachs said last week the International Energy Agency's plan to release 60 million barrels of oil by the end of July prompted it to lower its three-month Brent crude price target by $10 to $12 a barrel to $105 to $107 a barrel. Here are Goldman Sachs' energy stock picks for 2011: Cabot Oil & Gas (COG) is an independent oil and gas producer with operations in the North America. In an April 28 research note, Goldman analysts said investors have yet to grasp that Cabot "could repeat 30%-50% production growth again in 2012" while spending within cash flow from its participation in other oil shale operations. Goldman has a $67 price target on its shares. Its shares are up 23% this year and 62% over the past 12 months.
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