It's been a difficult past twelve months for the Woodside Petroleum Limited (ASX: WPL) share price. Shares in the Aussie energy giant have edged just 2.5% higher in that time while the S&P/ASX 200 Index (ASX: XJO) has gained 25.3%.
So, what's driving the oil and gas producer's valuations right now?
Why the Woodside Petroleum share price is up just 2.5% in the past year
Global crude oil prices have bounced around ever since the COVID-19 pandemic kicked off in early 2020. However, both Brent and WTI Crude prices have been broadly trending higher in the last 12 months.
That hasn't been reflected in the Woodside Petroleum share price recently. Shares in the oil and gas giant hit a 52-week high of $27.60 per share on 20 January 2021.
Unfortunately for shareholders, things have been largely downhill since then. The ASX energy share has fallen 29.4% lower in the intervening months to $19.48 per share at the time of writing.
To be clear, Woodside still boasts a $19 billion market capitalisation and is Australia's largest independent oil and gas producer.
It's set to become even larger amid a merger with BHP Group Ltd (ASX: BHP)'s petroleum division. The proposed all-stock merger will see Woodside own 52% of the merged entity as part of a push to create a global top 10 independent energy company.
The Woodside Petroleum share price has been sliding lower since merger talks surfaced in mid-August. Investors appear sceptical of the transaction's value as it aims to deliver a portfolio of long-life LNG assets and a high margin oil portfolio.
That valuation slump has occurred despite Woodside generating US$311 million in FY21 free cash flow and a $317 million net profit after tax.
Foolish takeaway
The Woodside Petroleum share price is one to watch in the months ahead. Shares in the Aussie energy share have been up and down this year and the BHP merger only adds more intrigue to one of Australia's largest listed companies.
