Riding High on 30%, Can Woodside Shares Continue To Create Wealth This Year?

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Woodside Petroleum has seen its share price rise by 30% since the start of 2021, making it one of the top-performing stocks on the ASX – but can this incredible momentum continue in 2023?

Investors who own shares of Woodside Energy Group Ltd (ASX: WDS) have had a phenomenal year – the stock has reached record heights, increasing by an impressive 34.89% to trade at $36.46 today!

The demand for Woodside’s black liquid surged during Russia’s invasion of Ukraine.

Unquestionably, the S&P/ASX 200 Index (ASX: XJO) energy giant witnessed an astonishing rise in their realised oil price during the first half of the year – more than doubling to hit US$96 per barrel.

Its oil production also soared 19%, helped by the company’s merger with BHP Group Ltd (ASX: BHP) ‘s petroleum assets.

Can Woodside shares continue to generate wealth in the long term, even after its incredible growth this year?

Tempting investors to consider Woodside shares as a long-term winner is the factor that could make all the difference in crude oil prices. Astonishingly enough!

At the moment, Brent crude is trading at approximately US$84 per barrel, and analysts project that this figure could rise even further.

According to Goldman Sachs, oil could soon be making a comeback and trading near its former high of US$100 per barrel.

Meanwhile, Dr Suhas Nayak of Allan Gray believes Woodside’s stock has been underestimated due to the current concern that oil prices will drop. Nevertheless, any such drops could be years away!

“Woodside Petroleum is a long-term winner that should be on the radar of investors. It has strong fundamentals and an impressive track record, making it one of the best investments for 2023,” he added.

He believes that years of inadequate investment in energy could result in sustained demand for oil before long, thus driving prices up with time. This would be beneficial to the profit margins of the ASX 200 energy giant.

Peering into the distant future, demand for oil and gas could diminish due to the energy transition. Nevertheless, the business has taken notice and begun strategising accordingly.

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