As oil fell in the second half of last year, analysts followed by lowering their ratings on European energy companies. They’re still cutting, even as oil rebounds.
A Bloomberg measure that converts each analyst’s current stock recommendation into a number —from one for a ‘sell’ to five for a ‘buy’— has continued to fall every month this year despite a 10 percent rally in the price of Brent crude.
The reluctance of analysts to boost their calls suggests they don’t yet believe the bounce in oil is sustainable.
Still, analysts tend to lag the market, so if the price of crude holds up they may yet be persuaded to upgrade stocks once more.