What happened 

Shares of independent oil and gas producer W&T Offshore (NYSE:WTI) jumped by as much as 16.8% in trading Thursday after the company reported fourth-quarter 2016 earnings after the close Wednesday. As of 1:56 p.m. EST, shares were up 14.9% on the day. 

So what

Revenue rose 10.7% to $115.2 million and the company swung from a net loss of $51.6 million to net income of $16.5 million, or $0.12 per share. On an adjusted basis, which pulls out one-time items, that was much better than the $0.13 loss analysts were expecting. 

Costs were down as lease operating expenses fell from $49.3 million a year ago to $33.8 million. Overall, expenses dropped 43.1% to $93.9 million, leading to the much better financial results. 

Now what

W&T Offshore's focus on cutting costs is starting to pay off, and rising oil prices are starting to help it as well.

Drilling rigs with the sun setting in the background.

Image source: Getty Images.

Fourth-quarter oil prices released were up 21.9% from a year ago to $45.10, much higher than the $37.35 realized for the full year. Given its lower cost structure and the support crude oil prices have in the market right now, I think the future looks bright for W&T Offshore. 

Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.