Stock of Imperial Petroleum (IMPP) has been on the forefront of today’s gainers in NASDAQ’s current market session. During the regular trading, the stock had closed at $1.48, which was a decline of 37.55% from its opening amount of $2.22. However, the stock had proven to be a gamechanger in the current market, seeing an increase of 39.18%. IMPP has clearly been caught up in a meme stock frenzy, brought about by retail investors on Reddit and Twitter.
Irregularities in the Oil Markets
The stock has been following a trend of continuous gain since Wednesday of last week, coinciding with Russia’s invasion of Ukraine, an event likely to push the world towards a significant oil crisis. The sanctions on oil-producing Russia, as well as increasing demand with the easing of Covid restrictions, continue to drive up oil prices. The announcement by the International Energy Agency (IEA) to deploy 60 million barrels of crude oil from its energy reserves has brought a collective sigh of relief across the oil market.
Imperial Petroleum, the once wholly-owned subsidiary of StealthGas Inc, upon completion of its spin-off, gained independent status from its parent company earlier in December. Ever since then, the stock was closely watched by traders and persisted in earning massive strides owing to rising oil prices. These circumstances saw the stock gaining by upwards of 280% last month alone. The current hype around the IMPP stock is suggestive of a similar price climb as was experienced last month.
Ambitions of Expansion
Imperial Petroleum (IMPP) did face backlash from investors, upon declaring intentions to expand its fleet, which it would fund through equity funding. As a result, existing stockholders would see a dilution of their shares in the company. Seasoned traders have warned against this, claiming that the company’s small size does not justify its net asset value per share. However, retail investors caught up in the social media frenzy surrounding the stock are less concerned with technical feasibilities, and more so with immediate swings with the stock. The substantial trade volume is an indicator of this hype, with most traders betting on the oil market irregularities amidst the Ukraine crisis to deliver ample gains.
Conclusion
The IMPP stock seems to be caught up in a trader’s frenzy hyped by social media. The gains it has delivered have been remarkable, and are moving along closely with increasing crude oil prices. The stock has been watched closely since its spinoff from the parent company, StealthGas, as well as its ambitions to expand its fleet.
