Magnum Hunter Resources, San Leon Energy and Exillon Energy have all risen strongly recently.
Oil prices surged this week on both sides of the Atlantic. Brent Crude climbed to $117 per barrel before settling down to end the week at around $114, while US WTI Crude rose from around $93.60 at the start of the week to trade at $95.50 when US markets opened on Friday. Natural gas looks set to end the week slightly lower and was trading at about $2.72/mmbtu when US markets opened on Friday morning.
Rising oil prices spelled good news for investors in the United States Oil Fund (NYSE: USO.US), which was up 4% by Friday morning. Investors in the United States Natural Gas Fund (NYSE: UNG.US) were less fortunate -- the fund was down by 3.5% on the week on Friday morning.
Strong oil prices usually help oil explorers, but I've found three companies that have each outperformed oil and gas prices by a big margin in recent weeks:
San Leon Energy
San Leon Energy (LSE: SLE) climbed 20% to 12p this week and rose by 12% on Friday alone, as investors bought in to what is expected to be a chain of positive news. This week saw confirmation that a farm-in agreement will be announced shortly for San Leon's offshore Morocco blocks, where it has a 42.5% stake. Also material to the company's rising valuation is its 4.5% profit-sharing stake in the Barryroe field in the Irish Sea, while investors remain hopeful that San Leon's Polish gas exploration will deliver solid results.
Magnum Hunter Resources
Magnum Hunter Resources (NYSE: MHR.US) rose 12.6% to $4.39 this week, cementing a 20.9% price rise over the last four weeks. The US-focused oil and gas explorer matched earnings expectations in its quarterly results, although it missed analysts' revenue targets. Magnum's proved reserves have risen by an average of 150% each year since 2008, and the company says it is on target to increase production from 13,400 boepd to 18,000 boepd by the end of 2012.
Exillon Energy (LSE: EXI) has risen by 28% to 120p over the last 30 days. The Russian oil E&P company finally seems to have overcome a losing streak that saw its share price fall from a peak of more than 300p late last year. Rising production and a connection to the Transneft pipeline have helped, but the other big change is that Worldview -- a hedge fund specialising in identifying value situations in this region -- has taken a 10% stake, suggesting that it believes a deal is likely.
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> Roland owns shares in San Leon Energy and Exillon but does not own any of the other shares mentioned in this article.