Occidental Petroleum Corporation OXY has been the best-performing stock in the S&P 500 in 2022 and has inflicted major pain on short sellers.
Growth stock weakness has generated big profits for short sellers overall in 2022, but Occidental is among many energy sector stocks that have been disastrous trades for short sellers so far this year.
The Numbers: Energy sector stocks currently have $75.5 billion in total short interest. S3 Partners analyst Ihor Dusaniwsky said Tuesday that energy sector short sellers have endured year-to-date mark-to-market losses of $18.1 billion, making it the only market sector of 2022 that has not been profitable for short sellers.
“Oil & Gas Drilling and Oil & Gas Equipment & Services were the worst performing sub-industries on the short-side in October,” Dusaniwsky said in a report.
Occidental remained the most popular short target in the energy sector with $3.6 billion in short interest. Exxon Mobil Corp (NYSE XOM) is a close second with $5.99 billion in short interest followed by Chevron Corporation CVX with $3.17 billion.
Among the 25 energy sector stocks with the highest short interest, S3 says Chesapeake Energy CHK has the highest short interest relative to its float at 16.4%.
Least Profitable Energy Shorts: Occidental tops the sector when it comes to the least profitable 2022 shorts in the energy sector. Year-to-date, short sellers of Occidental short have generated $1.6 billion in losses followed by Exxon with $1.5 billion in losses and Chevron with $1 billion in losses.
October has been particularly brutal for energy short sellers, which have collectively generated an 11.9% loss in the month so far.
Here are the five least profitable energy stock shorts of October (to date):
- Exxon Mobil, $576.9 million loss
- Chevron, $488 million loss
- Occidental Petroleum, $385 million loss
- Canadian Natural Resources Ltd CNQ, $380.5 million loss
- ConocoPhillips COP, $365.4 million loss
Benzinga’s Take: Inflation, rising interest rates and a global energy shortage is a perfect storm for energy stocks and a nightmare for energy stock short sellers. The long-term future of global energy is certainly renewables, but it may still be decades before the world eliminates its reliance on fossil fuels.