Woodside Energy share price is extremely bullish above A$36.40

Woodside Energy (ASX: WDS) share price held quite steady after the company’s earnings came lower than expectations. The shares initially dropped to A$35.31 and then pared back some of these losses to above A$36. In the UK, the Woodside’s stock jumped by more than 1.34% to 1,890p in early trading.

In all, the stock has outperformed the Vanguard Energy ETF (VDE) this year. The stock has risen by 12.50% while VDE has retreated by 1.56%.

Woodside had a worse quarter

Woodside Energy, the biggest oil and gas company in Australia, published results that missed analysts’ forecasts. The company made $3.08 billion in the second quarter, a 10% decline from the same period in 2022.

The company attributed this weakness to two main reasons. Crude oil and natural gas prices dropped in the second quarter. Also, the company’s production eased gradually. Its production dropped by 5% to 44.5 million barrels because of planned maintenance and turnaround activities.

Woodside Energy is investing for growth. For example, it managed to produce oil in its Mad Dog Phase 2 project, which boosted its output. The Scarborough project reached 38%  while the sangomar project was 88% complete. The company hopes that the Sangomar project will start production in mid-2024. In addition to this, the company made progress in its Trion project n Mexico.

Oil and gas companies are going through a difficult time as the economy slows. As I wrote here, China’s economy grew at a slower pace than expected in the second quarter. At the same time, Europe has moved into a recession. And recent economic numbers like manufacturing and industrial production shows that the American economy is slowing.

As a result, Brent crude oil has hovered above $70 in the past few months after averaging above $80 in 2023. Natural gas prices have dropped by over 80% from their 2022 highs. In Woodside’s case, the realised prices of LNG traded, oil and condensate, and NGL dropped to $11.0, $75, and $41, respectively. 

Woodside Energy share price analysis

WDS chart by TradingView

WDS stock price has been in an uptrend in the past few months even as the energy sector weakened. The shares are hovering at an important resistance level since they have struggled to move above this price since January. 

Woodside shares have moved above the 25-day and 50-day moving averages. Most importantly, they have formed an ascending triangle pattern, which is often a bullish sign. Therefore, there is a likelihood that the stock will continue rising as buyers target the key resistance level at A$37.28. This is an important level since it was the highest point in November.