Jim Cramer Returns to ConocoPhillips as Oil Prices Touch $96

Jim Cramer has returned his attention to ConocoPhillips (NYSE: COP) as oil prices surged to $96 per barrel, highlighting the oil and gas exploration and production company amid a bullish energy market. The stock has gained 32% over the past year and 24% year-to-date, reflecting strong performance driven by rising crude prices. The move comes as Brent crude trades near $96, with the Brent-WTI spread widening to around $5, signaling tight supply in global markets. The U.S. Strategic Petroleum Reserve (SPR) remains at historically low levels near 370 million barrels, limiting the government's ability to intervene in case of further price spikes. Meanwhile, crack spreads—the margin between crude oil and refined products like gasoline and diesel—have widened, boosting refinery margins and supporting demand for crude.

For energy traders, the move underscores the impact of geopolitical risk on oil supply. Mizuho recently raised its price target on COP to $150 from $136, maintaining an Outperform rating, citing potential long-term effects from the Iran conflict on global oil prices. Barclays also lifted its target to $155. The Iran situation adds a risk premium to oil, as any disruption to the Strait of Hormuz could remove millions of barrels per day from the market. OPEC+ spare capacity, largely held by Saudi Arabia and the UAE, stands at about 5 million barrels per day, but analysts question whether it can be deployed quickly enough to offset a major supply shock. Saudi-Russia coordination remains intact, with both nations signaling willingness to maintain production cuts to support prices. China's marginal demand, though sluggish due to economic headwinds, still provides a floor for prices as the world's largest crude importer. As oil touches $96, traders can monitor real-time fuel quotes on NowPrice to track price action and assess entry points in the energy sector.

Looking ahead, the key catalyst remains the Iran situation and its effect on supply. OPEC+ decisions and US inventory data will also be critical. If tensions escalate, oil could test the $100 level, benefiting producers like ConocoPhillips. The futures curve has shifted into backwardation, where near-term contracts trade at a premium to later ones, indicating immediate supply tightness. Conversely, a de-escalation could trigger profit-taking and a return to contango. Traders should watch for further analyst upgrades and weekly EIA reports, which provide insights into U.S. crude stockpiles and production trends. Any surprise build in inventories could ease upward pressure on prices, while a drawdown would reinforce the bullish narrative.