$Indonesia Energy Corp Ltd.(INDO)$ stock continued its growth trend-momentum of the last two months. Within this period, the stock peaked at a whopping 417.9% price rise.
Global Energy Crisis
The global energy sectors, particularly those that which is focused on oil and gas, are being watched closely by market participants. This is especially a result of the heightened demand, in wake of economic sanctions imposed against Russia. Indonesia Energy Corporation (IEC), along with other market giants, has been under the spotlight, given these fundamental shifts in the energy sectors. Demand for fossil fuels has also been reaching new heights amidst easing Covid-19 restrictions
With the pressure on limited supply lines, and demand reaching new heights given easing Covid-19 restrictions, all eyes are on oil drillers and suppliers such as IEC.
Expansion of Production Capacity and Implications for INDO Stock
An official announcement from the IEC earlier in January had turned the steering wheel on the company’s stock valuation. News of the imminentdrilling of two oil wells have caused the company’s market capitalization to balloon from $20.8M to a staggering $107.4M. The company further stated its plans on beginning drilling on a third oil well before June of this year. The announcement further boosts the company’s profitability potential. Withcrude oil prices risingover $118 per barrel, which is the highest its been at since 2013, the sector is looking at strengthened cash flow positions. The INDO stock movement seen throughout this week reflects these anticipations of the wider market.
Sustainable Diversification for INDO Stock
Another potential reason as to why INDO has presumably gained the confidence of investors is a recentdeal signed with Fusion Fuel Greenlater last month. The Irish company, being a highly promising player in the clean energy hydrogen sector offers sustainability to IEC’s future prospects. The agreement entails an installation of a state-of-the-art hydrogen production facility in Sinai. Investors are typically wary of companies that tie all their eggs in one basket. This is especially true when the basket is as volatile and unpredictable as the energy sector. This sustainable diversity, therefore, instills confidence in the company’s long-term prospects and growth potential.
Conclusion
The INDO stock is a big mover and has maintained its impressive growth trajectory for the last two weeks. Announcements of imminent oil drilling ambitions amidst the global energy crisis bring confidence amongst traders of the company’s growth potential. Its sustained diversification further emphasizes its long term prospects.
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