Why did the Beach Energy (ASX:BPT) share price nosedive 30% in 2021?

This ASX energy company had a devastating year. We take a closer look

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The Beach Energy Ltd (ASX: BPT) share price had a shocker of a year in 2021, suffering more lows than highs.

Shares in the oil and gas company fell from $1.81 to $1.26 during the year, a 30% decrease.

Let’s take a look at what weighed on investors’ minds.

A tough year

Beach Energy’s shares had a rollercoaster year characterised by a few bumps and one devastating fall in late April.

In mid-January, the share price fell 15% on the back of falling oil prices and broker downgrades. Between 13 January and 1 February, the company’s share price dropped 15%.

Investors also reacted to the company’s quarterly report released on 27 January, showing a 35% decline in sales revenue to $344 million. Shares then recovered 12% between 1 February and 9 February as oil prices continued to rise.

But the largest fall for the Beach Energy share price took place on one day in late April. Shares dropped 24% from $1.68 at market close on 29 April to $1.275 on 30 April.

Shares in the energy producer crashed following the release of the company’s third-quarter results. Investors reacted negatively to its production dropping 5% against the previous quarter and 15% lower than the third quarter of FY20.

September, however, brought far more joy to Beach’s shareholders. From 20 September to 30 September, shares exploded an incredible 43%. The company entered into an agreement with energy giant BP relating to its share of liquefied natural gas from the Waitsia gas project stage 2.

A well-received investor update from the company also helped the Beach Energy share price. Beach revealed it was aiming for production of 28 MMboe by FY 2024.

Continuing rising oil prices likely weighed on investors’ minds. Oil producers were struggling to provide enough of the liquid due to supply worries.

However, shares fell again in October and November, dropping nearly 21% in just those two months. Managing director and chief executive officer Matt Kay also resigned on 2 November. In addition, the company’s quarterly report didn’t help. As my Foolish colleague James reported, the results showed Beach’s production was down 4% to 5.7MMboe. Sales revenue also declined to $388 million.

Finally, December saw brighter days for Beach Energy, with the company’s shares gaining nearly 6% during the month. Rob Jager ONZM was appointed as an independent non-executive director on December 14. The share price also lifted slightly on news of progress on its joint venture with Mitsui & Co.

Looking ahead, ASX energy shares have had a positive start to the year thanks to rising oil prices.

Beach Energy share price snapshot

The Beach Energy share price performed 43% worse than the broader S&P/ASX 200 Index (ASX: XJO) in 2021.

It closed today down 3.8% at $1.265. However, it is up around 8% over the past month.

Beach Energy has a market capitalisation of nearly $2.9 billion based on its current share price.

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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