SYDNEY, July 9, 2026, 06:03 AEST
Santos Limited ASX:STO finished up strongly Wednesday, jumping 5.78% to A$7.50. Investors returned to Australian energy stocks after another move up in oil prices. The shares gained A$0.41 from the previous close at A$7.09 and changed hands in a tight A$7.30 to A$7.55 range.
Energy led gains as the S&P/ASX 200 slipped 0.21% to 8,785.10. Woodside Energy added 3.22% and Ampol was up 1.37%, even as the rest of the market dropped, a market report said.
Crude led the move. Brent crude closed up 5.2% at $78.02 a barrel as U.S.-Iran tensions flared again, sparking fresh worries about shipments through the Strait of Hormuz. The strait is a critical path for oil. “Fundamentally, the events of the last few days significantly weaken any confidence” in a lasting truce, Jorge Leon at Rystad Energy told Reuters. Reuters
For Santos, a higher oil price is more than a number on a screen. It drives investor expectations for realised oil and condensate pricing and can boost sentiment around LNG—liquefied natural gas prepared for shipping.
Santos shares moved without much to point to in the company’s news today. The latest updates on Santos’ site cover Indigenous training and jobs from July 8, and July 7 material on adding Indigenous participation to its business.
Traders focused on oil prices and new milestones. Santos announced at the end of last month it signed a domestic gas deal with the South Australian government, agreeing to supply 200 petajoules over 10 years starting in 2030. A petajoule measures energy.
Santos said it started continuous production at its Pikka Phase 1 oil project in Alaska. The company is looking to boost cash flow after years of spending, with Pikka and Barossa LNG now key parts of that effort.
Earlier this year, Chief Executive Kevin Gallagher said Barossa LNG and Pikka Phase 1 would “lift Santos’ production by around 25 to 30 per cent by 2027.” Santos is guiding for 2026 output between 101 million and 111 million barrels of oil equivalent, rising from 87.7 million in 2025. A barrel of oil equivalent combines gas and liquids as a single energy measure. Reuters
Santos shares are still trading below their May high. The stock is at A$7.50, about 9% under the 52-week top of A$8.24 but roughly 27% higher than the January low of A$5.92. The company’s next quarterly report is set for July 16, which will give a fresh look at production and project ramp-up.
The trade isn’t a one-way bet. If things cool off in the Gulf and oil prices drop again, Santos could lose the macro push that helped its shares Wednesday. There’s also the execution risk: for Santos to win over investors, Pikka and Barossa have to show they can deliver the volumes, keep costs down and stay online as promised before anyone prices in that extra cash-flow.
The stock is getting a lift from oil, which is giving it room to rally in the short term. For a re-rating, though, investors are still waiting on July’s update to see if the new projects are working like Santos promised.
