“We expect oil and gas prices to continue to higher from here over the next 12 months on the back of increasing demand and limited supply,” Michael said.

“However, for the past two years, the oil price has been fairly range-bound.

“This is not too dissimilar to how STO shares have traded.

“The great thing about it being range-bound is that it gives us a clear level to keep an eye on to know when it’s time to jump in.

“STO has been trading under a major resistance line near $8 and if it were to break above that, it should lead to a strong rally.

“It is still trading sideways under that range, but we have noticed a couple of positive developments.

“Firstly, the overall range is tightening up with the stock making higher lows in December and February.

“On a shorter-term basis, the range is also tightening up – the past several weeks has seen it consolidate just under $8.

“We are on hold here until we get that breakout, but that day may come within the next few weeks or so.

“STO is one to keep on the watchlist here and a weekly close above $8 would be the buy signal,” Michael said.

Santos (STO)

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