- BUY Entry – 0.36 Target – 0.40 Stop Loss – 0.34
- Rex International Holding Limited operates as an independent oil exploration and production company. It operates through Oil and Gas, and Non-Oil and Gas segments. The company offers Rex Virtual Drilling, a liquid hydrocarbon indicator, which uses seismic data to search for oil. The company is involved in the oil and gas exploration and production activities with a focus in Oman and Norway.
- Recovery in China’s demand for oil. China, the world’s top crude oil buyer, imported 45.83 million tonnes last month, data from the General Administration of Customs showed on Thursday, equivalent to 10.79 million barrels per day (bpd). That compares to 10.5 million bpd in April and to a 2021 average of 10.3 million bpd. Meanwhile, China’s May exports jumped 16.9% from a year earlier as easing COVID curbs allowed some factories to restart, the fastest growth since January this year and more than double analysts’ expectations.
- Supply remains tight. Iran removing two International Atomic Energy Agency surveillance cameras at a uranium enrichment facility raised tensions with the United States and other countries negotiating with Iran over its nuclear program, and will likely keep sanctions in place and Iranian oil out of the global market for longer. Efforts by the Organization of the Petroleum Exporting Countries and their allies, including Russia, a group known as OPEC+, to boost output are “not encouraging”, United Arab Emirates’ Energy Minister Suhail al-Mazrouei said, noting the group was currently 2.6 million bpd short of its target.
- Positive consensus estimates. According to Bloomberg consensus estimates, the company currently has a rating of 3 BUYS, 0 HOLD and 0 SELL, with a 12M TP of S$0.58, representing approximately a 98.4% potential upside as of 9 June 2022.
(Source: Bloomberg)
