Imperial Petroleum (NASDAQ:IMPP) stock is up 17% today as investors around the world continue to focus on the energy trade amid the ongoing crisis in Ukraine.
So what is going on with Imperial Petroleum?
Well, it seems IMPP stock is jumping higher after the United States and United Kingdom each announced that they will ban all imports of Russian oil. Also helping matters is an announcement that Imperial has acquired two new tankers that will help it ramp up shipments.
Imperial Petroleum has gained more than 100% in the year to date.
What Happened With IMPP Stock
Stocks of oil and gas producers continue to run higher as prices for the energy products hit multi-year highs. Yesterday, President Joe Biden announced that the U.S. is banning all Russian oil imports. The United Kingdom followed suit and also launched a plan to phase out Russian energy products by the end of 2022.
This news sent the price of West Texas Intermediate (WTI) crude oil, the U.S. benchmark, above $125 a barrel, its highest level since 2008. As recently as this past January, the U.S. oil price was trading under $80 per barrel. At the same time, Imperial Petroleum has announced that it has purchased two refined petroleum tankers that were built in South Korea and Japan.
Imperial reportedly spent $31 million to buy the tankers and plans to have them in service by the end of May.
Why It Matters
The bans on Russian energy products, which is expected to grow to include other nations in coming days, is likely to keep oil prices elevated for the foreseeable future, with some market analysts forecasting the price to reach $185 or even $200 a barrel later this year. That is good news for oil producers and their stocks, which are likely to continue rallying higher in the near term.
Imperial Petroleum’s tanker purchases shows that the company is taking steps to capitalize on the moment at hand, increasing its ability to transport crude oil to destinations that may be in short supply in coming months. Investors are responding to the news and pushing IMPP stock higher.
What’s Next for Imperial Petroleum
Global stock markets and energy prices remain volatile as geopolitical tensions continue to ratchet higher. Right now, oil stocks such as IMPP are outperforming the broader market. How long that lasts will depend on whether a resolution to the conflict in Ukraine can be reached and if oil prices come back down to $100 a barrel or lower. Investors should be careful.
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On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
