Oil pump under the blue sky, jet pump unit in the oil field, oil pump and water reflection
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High oil prices and lower capital spending should cause oil stocks to throw money away, and investors should add a few winners from this sector, according to Morgan Stanley.
While energy prices fell amid broad commodity weakness on Thursday, benchmark oil prices in the US and Europe are still up about 80% over the past year. Industry has seen demand increase and reserves shrink as economies reopen.
Analyst Devin McDermott shook his energy stock ratings on Friday, elevating Occidental Petroleum to overweight from equal weight and Marathon Oil to equal weight from underweight. In a note to customers, McDermott said these shifts would notably provide greater exposure to high oil prices.