What Happened?
A number of stocks fell in the afternoon session after crude oil prices fell sharply as President Trump paused the Strait of Hormuz military escort and cited progress on a U.S.–Iran peace deal.
Oil and gas company profits move almost directly with the price of oil: when oil falls, revenue per barrel falls, and profit margins compress. The Strait of Hormuz is a critical oil chokepoint: approximately 20% of global oil supply passes through it daily. When the strait is at risk from conflict, oil carries a geopolitical risk premium as extra price built in to reflect supply uncertainty. When that risk eases, the premium disappears and prices return toward the underlying supply-and-demand level. OPEC+, the group of major oil-producing countries, separately announced 188,000 barrels per day of additional supply starting June 2026, which added to the downward price pressure independent of the peace deal.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Oilfield Services company Core Laboratories (NYSE: CLB) fell 3.6%. Is now the time to buy Core Laboratories? Access our full analysis report here, it’s free.
- Oilfield Services company Helmerich & Payne (NYSE: HP) fell 3.5%. Is now the time to buy Helmerich & Payne? Access our full analysis report here, it’s free.
Zooming In On Core Laboratories (CLB)
Core Laboratories’s shares are very volatile and have had 24 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 5 days ago when the stock dropped 7.4% on the news that the company reported disappointing first-quarter 2026 financial results, with both earnings and revenue falling well short of expectations.
Core Laboratories disclosed earnings per share of $0.06, a 76.92% miss from the anticipated $0.26. The company's revenue for the quarter was $121.8 million, representing a 12% sequential and 1% year-over-year decline. Management attributed the poor performance to several disruptions. Severe cold weather in North America impacted client activities and led to the temporary closure of manufacturing facilities. Additionally, a storm in the Mediterranean Sea suspended the demand for lab services and caused significant damage to one of the company's locations, creating further challenges for revenue and profit margins during the quarter.
Core Laboratories is down 18% since the beginning of the year, and at $13.90 per share, it is trading 29.4% below its 52-week high of $19.67 from January 2026. Investors who bought $1,000 worth of Core Laboratories’s shares 5 years ago would now be looking at only $436.40.
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