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Woodside Petroleum Limited shares are falling as Shell jumps ship

Shares in Australia’s largest oil and gas company Woodside Petroleum Limited (ASX: WPL) are down over 3% this morning to $31.20 following global oil giant Royal Dutch Shell divesting its remaining $3.5 billion holding in the company.

The oil major completed its sale of 111.8 million shares for $31.10 to institutional investors in morning trade. Whilst Shell has divested its ownership interest in Woodside, the Anglo-Dutch company will continue to maintain a relationship with Woodside as a joint venture partner in the North West Shelf venture and the Browse LNG venture.

Strong demand from institutional investors to soak up such a large holding should be bullish for Woodside shareholders.

2017 has also seen a recovery in oil prices as the price of Brent Crude oil now trades at US$63 per barrel, the highest level since 2015.  However, prices are still well down from the lofty US$100+ level of 2014 when an excess amount of supply following the U.S. shale revolution led to a price collapse and a bear market for oil and gas stocks.

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Motley Fool contributor Tim Katavic has no financial interest in any company mentioned.  The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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