Can the Woodside share price crack $40 by Christmas?

The Woodside Energy Group Ltd (ASX: WDS) share price is down 0.58% to $35.84 on Thursday.

If we take a look at the chart below, we see that the ASX 200 energy giant hasn’t spent much time above the $36 per share mark over the past 12 months.

In fact, the Woodside share price has kind of gone sideways in 2023 after a very big run from 2020 to 2022.

In the year to date, the stock is up 1.6% while the benchmark S&P/ASX 200 Index (ASX: XJO) is up 5.6%.

But could it get to $40 by Christmas?

Broker sets $40 target for Woodside share price

According to the Australian Financial Review (AFR), broker CLSA has raised its rating on Woodside shares to accumulate with a price target of $40.

A price target has a 12-month timeline.

So, it’s the share price that CLSA thinks Woodside will run to between now and July 2024.

But could it get to $40 earlier?

Well, that will depend on company news and commodity prices over the next six months.

The latest news from Woodside

Woodside released its Q2 FY24 update on Wednesday. The market appeared happy with the news, and the Woodside share price gained 1.49% on the day.

But the report wasn’t particularly exciting.

Woodside reported a 5% decline in production to 44.5 MMboe due to planned turnaround and maintenance activities. As a result, sales volume was 48.4 MMboe, down 4% on 1Q FY24.

Combined with a lower average realised price, this led to Woodside reporting a 29% decline in revenue to US$3,084 million.

Woodside’s full-year production guidance remained unchanged though at 180 MMboe to 190 MMboe.

The next report we’re expecting from Woodside is its FY23 half-year results, which will be released during the August earnings season.

The report will include the company’s next interim dividend.

Last year, Woodside shares paid an interim dividend of $1.5995 per share.

If the dividend is higher than expected, perhaps that will push the Woodside share price a little higher temporarily.

Other than that, we’ll just have to wait and see whether Woodside has any other exciting news for us over the next six months that might push the share price closer to $40.

What’s more likely to do it is improving commodity prices for oil.

Could oil prices push the Woodside share price higher?

Oil prices have been gaining over the past three weeks.

The WTI crude oil price has risen 12% over the past three weeks from US$67 per barrel to US$75 today.

The Brent crude oil price has risen 10.5% from about US$72 per barrel to US$79.50 today.

Over the same time period, the Woodside share price has risen by 4.15%.

So, if oil prices continue appreciating, this will likely lift Woodside shares. But to what degree, we just don’t know.

Here’s what’s happening in the oil markets according to Trading Economics:

Oil prices found support earlier this week after China’s top economic planner pledged on Tuesday to roll out policies to “restore and expand” consumption in the world’s top crude importer.

On the supply side, Russia’s energy ministry said the country will cut oil exports by 2.1 million tons in the third quarter, in line with planned voluntary export cuts of 500,000 barrels per day in August.

Expectations that the end of the current monetary policy tightening cycle is getting closer also added to bullish sentiment.

Meanwhile, official data showed that US crude inventories declined by 708,000 barrels last week, compared with market expectations for a larger 2.4 million barrel drop.

What do the experts say about global energy markets?

As my Fool colleague Bernd reports, the Organization of the Petroleum Exporting Countries (OPEC) has a very bullish assessment of global oil demand for 2024.

“In 2024, solid global economic growth amid continued improvements in China is expected to boost consumption of oil,” OPEC said (quoted by Reuters).

Toril Bosoni, head of oil markets at the International Energy Agency, said (courtesy of Bloomberg):

We’re expecting a sharp tightening of the market. As demand increases seasonally, we do think there’s a risk that prices will continue to increase into the third quarter.

Jorge Leon, senior vice president of oil market research at Rystad Energy, said: “It is the tipping point the market was expecting. It looks like the start of the hot summer in the crude market.”

Bob McNally, president of Rapidan Energy Group, is forecasting Brent crude to return to US$90 per barrel.

“Barring an abrupt macroeconomic slowdown, the stars are aligning for a zesty crude price rally,” he said.

The Woodside share price has a 52-week high of $39.58, reached in November 2022.

Time will tell whether it can get to $40 by Christmas — or by the end of FY24, as CLSA predicts.