What Happened?
Shares of oil and gas company Granite Ridge Resources (NYSE:GRNT) jumped 3.8% in the afternoon session after renewed fighting across the Middle East, and a larger-than-expected drop in U.S. crude stockpiles reinforced concerns over oil supply.
Crude oil futures jumped more than 6%—snapping a three-day losing streak—as renewed fighting across the Middle East and a larger-than-expected drop in U.S. crude stockpiles reinforced concerns over a global supply squeeze.
The primary driver of the rally was the collapse of a four-day truce, marked by escalating hostilities between Iran and the U.S. Iran carried out a missile attack on a U.S. base and fired on tankers in the Strait of Hormuz, a critical chokepoint for global energy supplies. In response, U.S. and Saudi Arabian forces launched retaliatory strikes on Iran-aligned militias in Iraq. These developments revived fears of a wider regional conflict that could severely disrupt the flow of oil, sending Brent crude futures above $90 a barrel and West Texas Intermediate (WTI) climbing past $84 a barrel.
Adding fundamental support to this geopolitical rally, a report from the American Petroleum Institute (API) highlighted continued tightness in the domestic market. The API estimated that commercial crude oil inventories in the United States fell by 3.3 million barrels in the week ending July 24. A decrease in these stockpiles typically signals that demand is outpacing supply, putting upward pressure on prices. If confirmed by official government data, this draw would leave U.S. crude stockpiles at their lowest level for this time of year since 2018, providing a powerful dual tailwind for the energy sector alongside the Middle East tensions.
The shares were trading at $4.74, up 3.8% from the previous close.
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What Is The Market Telling Us
Granite Ridge Resources’s shares are quite volatile and have had 18 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 3 months ago when the stock dropped 10.3% on the news that the company reported disappointing first-quarter 2026 results that missed Wall Street's expectations for revenue and profit. The company's revenue of $128.3 million fell short of analyst estimates, but the more significant concern was its profitability. Adjusted earnings per share of $0.02 missed consensus by a staggering 82.8%, and adjusted EBITDA also failed to meet expectations. The company's financial health appeared strained as its operating margin fell to 11.6% from 34.6% in the same quarter last year, and free cash flow swung to a negative $2.03 million from a positive $9.36 million a year ago. This poor financial performance overshadowed an 11.4% year-on-year increase in oil production, leading to a negative investor reaction.
Granite Ridge Resources is up 1.2% since the beginning of the year, but at $4.74 per share, it is still trading 22.5% below its 52-week high of $6.11 from May 2026. Despite the year-to-date gain, investors who bought $1,000 worth of Granite Ridge Resources’s shares 5 years ago would now be looking at only $489.15.
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