Oil prices climb above $105 as bond yields rise

Shell, Chevron, and Harbour Energy are reducing Gulf of Mexico oil production and evacuating personnel due to Hurricane Isaias. By Wednesday, 25% of Gulf oil output (511,619 barrels/day) and 16% of gas production were offline. Isaias, the first 2026 Atlantic hurricane, is expected to hit the northern Gulf Coast. Oil prices rose Thursday, with Brent crude up 5% to $105.23/barrel and WTI at $92.70/barrel.

UBS raised its price target for Chevron (NYSE: CVX) to $235 from $220, citing stronger refining margins and higher earnings estimates. The firm projects Q3 2026 EPS of $4.93, up from $4.15, and expects $16.3B in cash flow. Chevron's stock is trading at $205.15, below its Fair Value of $221.74. The company has a market cap of $402B and a 38% YTD return. HSBC also raised its target to $250, noting Chevron's upstream sector strength.

Chevron (CVX) will exit Hess Midstream (HESM) via a swap, retaining infrastructure use at lower costs. Chevron expects a $3-4B after-tax loss but anticipates 50% cost savings in Bakken midstream operations. Hess Midstream will acquire Chevron's DJ Basin assets and become independent, with the deal expected to close by year-end.

Chevron has committed $88 million to explore Egypt’s offshore Lotus area, signing an agreement with EGAS. The project includes two exploration wells and 3D seismic data reprocessing. Egypt recently cleared $6.1 billion in arrears to foreign oil companies, aiming to revive upstream investment. Chevron is involved in six offshore exploration areas in Egypt, including Nargis and North El-Dabaa, partnering with companies like Eni and QatarEnergy.

Oil prices rose 3.9% (Brent) and 3.7% (WTI) due to Middle East shipping attacks and US Gulf Coast storm threats. Iran's attacks reduced Strait of Hormuz traffic. BP, Chevron, and Shell face potential US production disruptions. US crude inventories fell 3.2M barrels. IEA considers reserve releases. Higher oil prices may impact inflation and interest rates.

Oil prices surged 3.8% to $104/barrel due to Middle East tensions and a US hurricane threat, impacting production. Reports suggest potential US strikes on Iran, raising supply concerns. Shell and Chevron halted Gulf of Mexico production. Maersk increased fuel surcharges, fueling inflation fears and bond market sell-offs.