Shell (SHEL) Explodes to 52-Week High on Middle East Oil Price Shock

▲ Shell (SHELL)/AI generated image

Shell (SHEL) set a new 52-week high amid a surge in international oil prices.

According to Benzinga on September 15 (local time), Shell's stock price broke its 52-week high amid concerns over Middle East crude oil supply disruptions and production halts in Libya. West Texas Intermediate (WTI) crude surged 4.3% that day, reaching $105.75 per barrel. On the same day, while Nasdaq fell 0.61% and S&P 500 dropped 0.53%, the Energy Select Sector SPDR Fund (XLE) rose 2.25%.

Shell also embarked on a restructuring of its US power business portfolio. Its subsidiary, Shell Energy North America, agreed to sell its stake in RISEC Holdings to Constellation Energy Generation for $715 million. RISEC owns a 609 MW natural gas power plant that supplies electricity to the New England market. At the same time, Shell decided to acquire Hunlock Creek Generating, which operates a 169 MW natural gas power facility in Pennsylvania. Both transactions are expected to be completed in the first quarter of 2027, pending regulatory approvals.

Technical trends also showed a strong bullish sentiment. Shell's stock price remained 5.7% above its 20-day simple moving average, 10% above its 50-day line, and 18.1% above its 200-day line. The 20-day moving average was above the 50-day moving average, and the 50-day moving average was also above the 200-day moving average, indicating an upward trend in the moving average arrangement. However, the Relative Strength Index (RSI) stood at 76.18, exceeding the typical overbought threshold of 70.

Benzinga analyzed that since the stock price surpassed the previous 52-week high of $97.63, this price level could act as a support line during corrections. Wall Street's average target price is $109.57. Piper Sandler maintained a neutral rating while raising its target price to $100, and Wells Fargo upgraded its target price to $105 with an equal-weight rating.

With supply disruptions in the Middle East and Libya driving up oil prices, coupled with Shell's restructuring of its US power assets, the momentum for stock price appreciation intensified. Conversely, as the Relative Strength Index (RSI) rose to 76.18, technical signals of short-term overheating also appeared simultaneously.

[Article Summary]

-Shell broke its 52-week high as international oil prices surged 4.3% to $105.75 per barrel.

-Shell embarked on a restructuring of its power business portfolio by simultaneously pursuing the sale and acquisition of US natural gas power assets.

-The stock price was above all major moving averages, but the Relative Strength Index (RSI) entered the overbought zone at 76.18.

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