Sky Quarry Inc. (SKYQ) is having a good Wednesday. The stock is up 18% to $3.54, and it's not hard to see why: oil prices are surging after the U.S. and Iran traded strikes across the Gulf region. President Donald Trump declared the June ceasefire with Iran is "over," following a new U.S. strike and reports that Tehran targeted merchant ships in the Strait of Hormuz. The move came after Washington revoked a waiver that allowed Iranian crude sales.
The broader market isn't loving this. The Nasdaq is down 0.44%, and the S&P 500 has shed 0.68%. But the Energy sector is the star of the show, gaining 1.63%. That's a nice rebound after a rough stretch — the sector was down 4.71% over the past 30 days and 3.05% over the past 90 days.
Crude oil prices are spiking. West Texas Intermediate crude jumped 7.4% to around $75.69 a barrel, while Brent crude rose 7.9% to move back above $80. Diesel futures also surged more than 13% as traders brace for tighter refined-product supply. When geopolitical conflicts disrupt supply lines, energy stocks tend to benefit.
For Sky Quarry specifically, there's more going on than just macro tailwinds. The company is a development-stage refiner preparing to start production this July at its Foreland Refinery in Nevada. It has 10,000 barrels of on-site inventory and 100,000 barrels of storage capacity. That's a lot of potential output if oil prices stay elevated.
Investors have also been watching short interest, which increased from 327,120 to 467,520 shares — now representing 10.25% of publicly available shares. That's a notable short position, and a rally like this could squeeze shorts if it continues.
Technically, the stock is testing some important levels. It's trading 86.5% above the 20-day simple moving average (SMA) of $2.23, 40.2% above the 50-day SMA of $2.97, and 9.1% above the 100-day SMA of $3.81. More importantly, it's pressing right around the 200-day SMA of $3.52 — a common "line in the sand" that often decides whether a bounce stays tactical or starts to look like a bigger trend repair. At $3.54, Sky Quarry is flirting with that level.
Whether this rally has legs depends on how the geopolitical situation evolves. But for now, Sky Quarry is riding a wave of higher oil prices and a market that's suddenly paying attention to energy again.
