JP Morgan sees geopolitics reclaiming the driver’s seat for European oil and gas equities, arguing that a higher risk premium has helped push oil prices up, and dragged energy shares higher year-to-date in the process.
The bank's analysts, in a note, said the sector’s recent performance has “re-coupled to rallying oil prices” after a stretch of “positive decoupling” in the second half of 2025, adding that the move looks increasingly macro-led given a “relatively benign EPS revision backdrop” even as share prices have run ahead.
In a mark-to-market refresh of its 2026 and 2027 numbers, JPMorgan sees Brent at $69 and $66, while keeping its long-term Brent view unchanged at $65.
The analysts at JP Morgan favour 'overweight' ratings for Shell PLC (LSE:SHEL, NYSE:SHEL) and Galp, while flagging greater caution on names such as underweight Equinor and Eni, where it sees higher dependence on oil and gas price outcomes.