Why has the Woodside (ASX:WPL) share price had such a slow start to December?

A number of events have led Woodside shares to falter in recent times.

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The Woodside Petroleum Limited (ASX: WPL) share price had a disappointing run in the first few days of December.

Since the beginning of the month, the energy producer’s shares have been trading flat. Except for yesterday when, following the upbeat sentiment of the day, the Woodside share price rose 1.95% to $21.94.

In contrast, the S&P/ASX 200 Energy Index (ASX: XEJ) climbed 3.56% over the same timeframe.

Let’s take a closer look at what may have caused Woodside shares to struggle until now.

What’s happened to Woodside shares?

A number of events have led Woodside shares to falter in recent times.

First and foremost, the Omicron coronavirus variant caused widespread fear that the global economy would be halted again. Travel restrictions to southern Africa and reports that the virus had spread to Europe and Asia weighed on investor confidence.

However, as more news comes to light, it appears the Omicron virus is not as severe as previously thought. The symptoms are said to be mild as compared with the more deadly Delta virus. This could lead to countries reopening their borders and recommencing the global recovery.

In addition, the price of oil had slumped for six weeks in a row across both benchmarks. This relates to the West Texas Intermediate (WTI) and more expensive alternative, Brent Crude.

Although, renewed optimism from the Organisation of the Petroleum Exporting Countries (OPEC) has led it to increase oil supply. The intergovernmental organisation will expand monthly supply by 400,000 barrels per day from January.

Since 1 December, the WTI has surged from trading around US$65.57 per barrel to now US$72.32 per barrel. This represents an increase of about 10.2% over the past few days.

Lastly, Woodside has been busy fighting a legal challenge against the Conservation Council of Western Australia (CCWA).

The $16.5 billion Western Australian Pluto LNG project remains at stake given the carbon footprint it will produce when online. While it’s still up in the air, for now, investors have been paying close attention to the ongoing developments.

Woodside share price summary

The Woodside share price is down 5% over the last 12 months, and is 2.8% lower year to date. The company’s shares took a dive to $14.93 when COVID-19 put the global economy at a standstill. Since then, its shares have traded sideways arounds the low $20 mark.

Woodside commands a market capitalisation of roughly $21.27 billion, with 969.63 million shares on its registry.

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Motley Fool contributor Aaron Teboneras owns shares of Woodside Petroleum Ltd. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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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