Woodside, page-5113

Woodside Energy Group (WDS) has seen increased short interest recently, with several factors contributing to this trend. Here’s a breakdown of why WDS is being shorted:

1. Declining Oil Prices and Macroeconomic Pressures

• Oil prices have dropped significantly, with Brent crude falling from ~$95/barrel in late 2023 to ~$65/barrel in May 2025 due to increased OPEC+ production and concerns over slowing global demand 510.

• Short sellers may be betting on further declines, as lower oil prices directly impact Woodside’s revenue and profitability.

2. Underperformance of ASX Energy Sector

• The S&P/ASX 200 Energy Index (XEJ) has underperformed the broader market by ~32% since its August 2023 peak, reflecting investor pessimism toward oil and gas stocks 10.

• Woodside’s share price has declined ~23% YoY (as of June 2025), making it a target for bearish traders 5.

3. Increased Short Interest Metrics

• NYSE-listed WDS: Short interest rose 31.8% in May 2025 to 2.32M shares (0.12% of float), with a "days to cover" ratio of 2.2 27.

• ASX-listed WDS: Short positions reached 3.17% of issued shares in early May 2025, ranking it among the top 100 most shorted ASX stocks 4.

4. Company-Specific Risks

• Dividend Cuts: Woodside reduced its FY2024 final dividend by 12%, reflecting weaker earnings 12.

• Execution Risks: Concerns linger over Woodside’s large-scale projects (e.g., Scarborough, Sangomar) and integration challenges from its BHP Petroleum acquisition 10.

5. Mixed Analyst Sentiment

• While some brokers (e.g., Ord Minnett) upgraded WDS to "Buy" citing undervaluation, others (e.g., Macquarie) downgraded it to "Hold" due to near-term headwinds 710.

• Short sellers may be capitalizing on this divergence, anticipating further downside before a potential rebound.

Key Takeaway

Short sellers are targeting WDS due to oil price volatility, sector-wide weakness, and company-specific risks. However, some analysts argue the stock is oversold, with Ord Minnett forecasting a 25% upside if oil prices recover to ~$70/barrel in 2026 10.

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