BWS Financial analysts initiated coverage on Sable Offshore (NYSE:SOC) with a Sell rating and a price target of $6 on the stock. The report expresses skepticism about Sable Offshore's ability to restart oil production off the Santa Barbara coast, citing regulatory hurdles that could prevent the project from progressing.

SOC’s acquisition of offshore platforms—previously owned by ExxonMobil and inactive since a 2015 oil spill—was based on a strategy to secure regulatory and community support to resume production. While SOC has managed to obtain some preliminary approvals, BWS Financial notes a strong likelihood of prolonged regulatory delays, along with potential requirements for additional studies and reports, before any production could resume.

These anticipated delays not only threaten to increase costs but could ultimately result in SOC facing financial pressures beyond initial estimates. According to the terms of the acquisition agreement, excessive delays could allow ExxonMobil to reclaim ownership of the assets without compensating SOC, adding another layer of risk to the investment.