Credit: Image source: Getty Images.Every week, the world gets an update on the state of the U.S. oil market. While the U.S. is just a part of a global industry, it is an enormous part. That's why, without fail, traders, industry players, and policymakers wait with bated breath for the U.S. Energy Information Administration's Weekly Petroleum Status Report, which gives detailed updates on the supply of oil and its derivative products in the United States.
Last week's report contained a flurry of good news for oil bulls. U.S. crude imports averaged over 7.4 million barrels daily, up by 59,000 barrels daily from the previous week. However, over the past month, imports averaged 7.1 million barrels per day, 9.3% below the same four-week period a year ago. U.S. commercial crude-oil inventories, excluding those in the Strategic Petroleum Reserve, also fell once again, this time by 1.8 million barrels.
Last week's oil inventory report has been a continuation of a full-blown trend:
US Change in Crude Oil Stocks data by YCharts
With oil inventories finally dropping, and hints of a new bull market for crude emerging, investors should be taking a close look at EOG Resources (NYSE: EOG) , Anadarko Petroleum (NYSE: APA) , and Apache Corp. (NYSE: APA) .
Efficiency is the name of the game
The bear market for petroleum hasn't stopped EOG Resources. It has used the crude-oil downturn to enhance its operations and make acquisitions in the hopes of an eventual rebound. It has also made efforts to do more with less through efficiency gains. The average premium well it drilled in 2016 -- that is, oil wells that the company estimates can produce a profit at $30 per barrel -- provided 200,000 barrels of oil in its very first year at a cost of just $7,600 per first-year barrels of oil equivalent per day (BOE/d). Its recent results continue to show EOG to be a best-in-class exploration-and-production (E&P) organization.
In its Q2 report , EOG Resources noted that its oil production was up 25% over 2015 to 334,700 barrels daily, a company record. On top of that, total production, including natural gas and natural gas liquids, was 603,900 BOE/d, which was also ahead of its expectation of 562,200 to 592,700 BOE/d. In the Delaware Basin, part of the Permian, the company completed 25 wells in the Wolfcamp development throughout the quarter, which accomplished preliminary 30-day rates of 3,010 BOE/d.
Looking ahead, analysts covering EOG and polled by S&P Global Market Intelligence expect earnings per share to grow from $1.42 in fiscal 2018 to $6.17 in fiscal 2021.
A first-draft E&P stock
Anadarko Petroleum is among the world's biggest independent E&P companies, with roughly 1.7 billion BOE of proven reserves as of Dec. 31, 2016. Anadarko's operations consist of U.S. onshore properties in every state but Hawaii, deepwater drilling in the Gulf of Mexico, and global E&P in Algeria, Ghana, Mozambique, Colombia, Cote d'Ivoire, and other countries. Its operations -- consisting of E&P, midstream, and marketing business segments -- have held up well in the face of the sheer destruction within the sector since 2014 that has come at the hands of capital expenditure reductions and a relentless focus on efficiency:
APC Free Cash Flow (TTM) data by YCharts
Should oil prices stage a rebound, Anadarko will almost certainly be one of the top-performing E&P stocks.
Primed for a rebound
Apache Corporation, with roots going back to 1954, is an oil and gas producer all Foolish investors will want to take note of. It produces oil not just here, but also in the North Sea and Egypt. That being said, last year, Apache's North American operations contributed approximately 54% of production and comprised 69% of its estimated year-end proven reserves.
As with the preceding stocks, Apache is a notable player in the Permian Basin of West Texas. It had 3.1 million gross acres there as of year-end 2016, with estimated proven reserves of 611 million barrels of oil equivalent -- 47% of the company's worldwide reserves. It also drilled 132 wells there last year, 96% of which were successful.
More recently, the company has been making moves in anticipation of a rebound, which probably led to the company's disappointing Q2 earnings release . Shares fell some 8% when Apache reported an adjusted second-quarter loss of $0.21 per share and lowered its production guidance for both fiscal 2017 and 2018. Production fell because of planned maintenance of the company's North Sea operations, but that production will return.
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Sean O'Reilly has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
