Why oil stocks won't necessarily join in the oil price rally

With the oil price hitting fresh three-year highs, it's scarcely surprising that investors have rediscovered a taste for black gold, but analysts caution that this won't necessary spark a major share price rally for locally listed oil and gas giants such as Woodside Petroleum, Santos and Oil Search.

Indeed, the sector had a decidedly subdued start to the week – Woodside rose slightly, but both Oil Search and Santos lost ground – even though Brent crude,the international oil benchmark, briefly broke above $US70 a barrel last week for first time since December 2014.