It seems Wall Street is buying the rumor and the news in this instance. OPEC’s pending oil production cuts have been telegraphed for weeks now as the cartel looks to save its own skin. This weekend, though, OPEC made those cuts official. Energy stocks are loving it, but perhaps beleaguered Chesapeake Energy Corporation (NYSE:CHK) and its shareholders are happiest of all.

CHK stock rocketed ahead with a 6% before falling back to more modest gains in the morning session. But don’t take that as a sign that OPEC’s plans aren’t wind in Chesapeake’s sails.

Chesapeake’s turnaround goals are suddenly that much closer to fruition. That means the world to long-suffering shareholders.

Why Chesapeake Loves OPEC’s Announcement

The energy industry has suffered for the past couple years amid heavy oil production. OPEC’s unwillingness to cut has been a significant part of that. Whether the move was calculated to try and rid the world of fracking or simply to keep its own revenues afloat, the cartel’s decision to keep its daily production humming over the past few years has kept prices in the basement.

That weighed on various parts of the world, including Saudi Arabia and Nigeria. But it also hit numerous energy stocks in the U.S.; particularly CHK stock.

Chesapeake Energy incurred massive debts during the previous oil boom so it could expand into new shale formations and grow to be one of the largest frackers in North America. That was fine and dandy until oil and gas prices began to drop. As a result, cash flows dried up, and CHK almost flirted with bankruptcy about a year ago.

Then Chesapeake started to show a little life.

Production cuts in the U.S. and other parts of the world began to work their magic. Oil has steadily risen over the past few months, and that helped Chesapeake’s operational performance (and gave CHK stock a bump). Chesapeake used the extra cash smartly by purchasing its own distressed debt for pennies on the dollar, investing in new cheaper drilling technologies and using capital expenditures only on the best and lowest-cost shales.

Chesapeake still was just a shell of its former high-growth self, but it wasn’t a zombie anymore.

And now, OPEC has pushed Chesapeake back into the world of the fully living. Crude oil is surging after a multitude of member nations — including critical players like Iraq — as well as non-member states agreeing to cut production. As of the time of writing, Brent-benchmarked crude oil jumped more than 4%, while U.S.-produced West Texas Intermediate popped by nearly 5%.

CHK Stock Is the Right Play for Higher Oil Prices

While other major oil players like Exxon Mobil Corporation (NYSE:XOM) and Chevron Corporation (NYSE:CVX) will benefit from the deal, too, CHK stock could be the biggest winner.

It still has the most at stake.

At the end of last quarter, Chesapeake still had about $8.7 billion in debt from its former buying/expansion binge. That’s nowhere near as big as the yoke around its neck previously, but it’s still an issue — and higher oil prices make it less of one. Ultimately, operating cash flows will be enhanced by any increased average selling price at CHK. Chesapeake can then turn around and use that cash to reduce debts and expand its low-cost drilling plans.

This could finally translate into — dare I say it? — meaningful profits.

Chesapeake managed to squeak out a slight profit of 9 cents per share for its third quarter when kicking out non-recurring items. But those profits could really be set up to explode now.

And more importantly, it puts bankruptcy well off the table for now.

Take Chesapeake for a Spin

After years of suffering and huge bouts of volatility, CHK stock might finally be a buy for investors rather than a quick trade. OPEC’s cut and the subsequent rise in oil prices is just what the doctor ordered.

Longer-term, if the production cuts hold and oil does actually rise meaningfully, Chesapeake could be one of the biggest movers. It’s not out of the woods yet, but this deal completely changes the company’s outlook on life.

As of this writing, Aaron Levitt did not hold a position in any of the aforementioned securities.