The BP share price is close to a breakout as the price of crude oil rises to a three-year high. BP is trading at 324p, where it has been in the past few days. That brings its year-to-date gains to more than 28%. It has outperformed Royal Dutch share price, which is barely moved this year.
BP news. BP, the giant oil supermajor, is doing relatively well, helped by the relatively higher oil prices. The price of oil has jumped to a three-year high after the latest OPEC+ meeting. Brent has jumped to more than $77 per barrel while West Texas Intermediate (WTI) has risen to $76. This is notable since the price of WTI declined to -$38 in 2020.
Higher oil prices will help BP do more in the next few months. For one, they will help it increase its free cash flow, which will help it improve its investments in clean energy. Further, these funds will help the company boost its dividends and share buybacks.
A few months ago, the company said that it would boost its returns to shareholders after it managed to lower its debt faster than expected. This trend is continuing after reports emerged that the firm was considering moving out of Iraq.
The four-hour chart shows that the BP stock has been in a tight range recently. The shares have struggled moving above the important resistance level at 327p. It has also formed an ascending triangle pattern that is shown in blue. This triangle is nearing its confluence level. The stock is also slightly above the 25-day moving average.
Therefore, there is a probability that the BP share price will break out higher as bulls target the next key resistance at 350p. To do that, bulls will need to first move above the year-to-date high of 336p. On the other hand, a drop below the support at 310p will invalidate the bullish view.
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