KOS - Why Kosmos Energy Stock Rallied 15% in Early Trading Today
Shares of offshore oil driller Kosmos Energy (NYSE: KOS) rose as much as 15% on Nov. 18, moving steadily higher from the open until around 11:30 a.m. EST. At roughly 12:30 p.m. EST the stock was still holding on to most of its gain, up around 12%. The rising price of oil was the main factor, but there's a story behind that move that you need to understand.
Kosmos is an energy company , and its top and bottom lines are driven by the often volatile price of oil and natural gas. Energy prices have been low lately because of a massive supply/demand imbalance. A huge part of the imbalance is related to the economic shutdowns being used to slow the spread of the coronavirus, which have resulted in a rapid and large decline in demand. With far too much supply and reduced demand, oil and gas prices fell -- just as you'd expect in an oversupplied market. At this point, with economic activity starting to pick up again despite a resurgent virus, energy prices have risen off their worst levels of the year but still remain low and range bound.
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Why Kosmos Energy Stock Rallied 15% in Early Trading Today