The Santos Ltd (ASX: STO) share price slumped 3.89% lower yesterday and is now down 36.6% in 2020.
Given the S&P/ASX 200 Index (ASX: XJO) has only fallen 14.4% this year, could the Aussie oil and gas operator be in the buy zone?
Why the Santos share price has slumped lower
Santos is a leading independent oil and gas producer across the Asia-Pacific. It's a consistent performer and is valued at $10.8 billion right now.
However, investors have been selling out of Santos shares in 2020. The coronavirus pandemic was the trigger but ASX oil shares have been hit particularly hard.
Demand for oil slumped as the travel and manufacturing industries shut down in February and March. That sparked an oil price war between OPEC+ and Russia which created a supply glut and sent the oil price plummeting lower.
While oil prices have started to stabilise, the Santos share price is still trading at a steep discount to where it started the year.
Shares don't often fall for no reason, but there was a lot of market panic in February and March. That could mean the Aussie oil and gas producer is a cheap buy right now or could be set to fall further.
Is Santos a cheap ASX oil share to buy today?
I think any ASX oil share is a speculative buy right now. However, if I was going to be investing, I'd prefer to look at large-cap shares like Santos.
It might be worth considering if the Santos share price is cheap relative to competitors' shares.
The Woodside Petroleum Limited (ASX: WPL) share price has fallen 39.9% this year. Woodside currently has a $19.7 billion market capitalisation, making it almost double the value of Santos.
However, if you're looking for a pure-play oil and gas share, Santos could be a good option.
Foolish takeaway
The Santos share price could be volatile in the months ahead as oil prices continue to move. However, the Aussie oil and gas giant is trading at $5.19 per share and could be a cheap buy for investors looking to take some risks.
