Crude Tops $50 a Barrel Sending Oil Stocks Surging This Week

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Oil topped $50 a barrel this week, though it did close down below that key price point.

However, oil was still up 1.9% for the week due to continued global supply disruptions as

well as the looming OPEC meeting. That helped ignite a rally in oil stocks.

What:Chesapeake Energy (NYSE: CHK) rallied 10% this week.

So What: Key driver: Royalty settlement

and another debt-for-equity swap

Chesapeake Energy and Total agreed to pay $52.5 million to 13,000 people in the Barnett Shale to settle a royalty dispute

Of that amount, Chesapeake will pay $29.4 upon court approval of the settlement and another $10 million in three years with Total paying the other $13.1 million

Now What: The company also completed

another debt-for-equity swap issuing 5.2% of its outstanding shares in exchange for some debt

This is the second exchange in a month, with the company swapping a total of 10% of its stock for 4% of its debt

Key takeaway: The increasing financial certainty has investors breathing a little easier that Chesapeake Energy might just make it through the downturn

What:Crestwood Equity Partners (NYSE: CEQP) jumped more than 16% this week.

So What: Key driver: Upsized

tender offer On May 12, Crestwood

commenced a cash tender offer to purchase up to $250 million of its notes at a slight discount to the principal amount

Now What: However, after investors

tendered nearly $480 million in bonds, the company decided to amend the terms of its offer and increase its aggregate purchase price to $312 million in order to take out more debt at a discount

Key takeaway: Investors are glad to see that this tender offer was a success

What:Fairmount Santrol (NYSE: FMSA) jumped 20% this week.

So What: Key driver: Analyst upgrades RBC upgraded the company

from sector perform to outperform, while also lifting its price target from $4 to $10

It cited increasing proppant intensity driving upside to analyst expectations

Now What: Morgan Stanley followed suit,

upgrading the stock from equal weight to overweight, while giving it a $9 price target

It cited the elimination of the company’s near-term debt overhang as well as increased conviction in a frac sand recovery

Key takeaway: Investors are buying into the potential that analysts are pointing out

What:Pioneer Energy Services (NYSE: PES) jumped 22% this week.

So What: Key driver: Oil prices and a

presentation at an analyst conference

With oil touching $50 a barrel, it is increasingly likely that drilling rigs will start to go back to work, which bodes well for Pioneer

Now What: In fact, at an analyst conference

this week the company noted that it is already starting to see an increase in utilization

Drilling utilization is currently 42%, up from 40% last month, while well servicing utilization is 40%, up from 37% last month

Key takeaway: Investors are starting to see some green shoots now that oil is around $50 a barrel

What:EXCO Resources (NYSE: XCO) surged 27.1% this week.

So What: Key driver: Capex and

restructuring update EXCO is cutting its 2016 capex

budget to just $85 million, which is 69% below last year

The company also said that it has now reduced net debt to $1.1 billion, which is down 28% since last September

Now What: Finally, the company

noted that it has $250 million of liquidity and only expects a liquidity burn of $10 million a month this year

Key takeaway: Investors like the progress the company has made

This could be the next billion-dollar iSecret