West Texas crude, the U.S. benchmark for oil, was up 1% at $98 per barrel at the close of the week as futures contracts crept back up toward the $100 mark after a volatile run prompted by democratic unrest in the oil-bearing regions of North Africa and the Middle East. The ways to play oil’s future trading price in the market are as frenetic as the commodity’s activity, and many suggest caution in speculating now.
Nestled in the world of small-cap and distressed companies, there are a few other ways to play oil. Shares in Houston-based Hercules Offshore (NASDAQ:HERO) shot up more than 20% Friday and were trading at $5.20 briefly before pulling back slightly to close at $4.93. The stock took off as trading volume quadrupled to 13.5 million shares, compared with an average 3-month volume of 3.1 million shares.
The buying and selling surge came from an upgrade in a note that Credit Suisse released Friday in which analysts raised the price target for HERO by a dollar, to $5.50, and reiterated the stock’s Outperform rating.
After going public in 2005, the company today contracts offshore rigs and inland barges for oil and natural gas exploration focused in the Gulf of Mexico.
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