WTI posts first gain in 12 sessions as OPEC comes to the rescue
Today's energy market summary:
Brent and WTI rallied 1% on Wednesday, the first meaningful increase since November 5th, on renewed hopes for more production cuts out of OPEC.
The oil cartel now says they may cut output by as much as 1.4 million bbl/day next year. An official statement is not expected until December 6, when OPEC and Russia meet in Vienna.
The International Energy Agency (IEA) cut its oil demand growth forecast for emerging markets, and now predicts a 2 million bbl/day global inventory build for the first half of 2019.
The American Petroleum Institute (API) is forecasting another 8.8 million barrel build in US crude stockpiles. Official figures from the US Energy Information Administration (EIA) are due tomorrow morning.
Henry Hub surged 18%, ending the day at US$4.84/MMBtu, the highest since early 2014. Natural gas stockpiles sit at a 15-year seasonal low, as a winter blast heads for the eastern seaboard.
US equity markets failed to rally again today, as both the Dow and Nasdaq sank another 1%. The S&P 500 posted its fifth day of losses, falling 0.8%, with most sectors ending the day lower. The SPX energy sector dipped 0.1%.
Today's notable energy news:
Suncor Energy (SU.TO +2.7%) CEO Steve Williams announced his retirement effective May 2019. Williams has been with Suncor since 2002 and will be replaced by Mark Little, who currently serves as COO.
FERC has approved the start-up of certain sections of TransCanada's (TRP.TO +2.1%) WB XPress natural gas pipeline in West Virginia and Virginia. The 1.3 Bcf/day line delivers gas from the Marcellus and Utica shale to parts of the US and Canada. The company also says its 2 Bcf/day Mountaineer pipeline in West Virginia and 880 MMcf/day Gulf XPress projects will be completed by the end of this year.
According to Bloomberg, ConocoPhillips (COP +0.6%) is looking to sell its remaining assets in the UK North Sea by the end of this year. The properties are worth an estimated US$3 billion.
Cheniere Energy (LNG -1.6%) says it began producing LNG at its Corpus Christi export terminal in Texas, in preparation for the facility's first cargo shipment. This is the third major LNG export terminal to be put into service in the US.
Oilfield services firm Weatherford (WFT -12.0%) hit penny-stock status this week, as shares have now sunk to a 29-year low. The company has US$7.6 billion in debt and has hired a new CEO to help restructure its operations, sell-off non-core businesses and reduce costs. Although a debt-default is not yet on the table, the company could be delisted from the Nasdaq if share prices don't recover in the next 30 days.
Warren Buffet's Berkshire Hathaway (BRK.B -0.9%) cut its stake in Phillips 66 (PSX +0.8%) to 15.4 million shares by the end of Q2, about half the previous quarter.
Third quarter earnings on the TSX:
Birchcliff Energy (BIR +3.1%) posted a net profit of $7.7 million, versus $121 million loss for the same quarter last year. Revenues rose 40% y/y to $157 million, while production increased 22% to 79,331 boe/day. For 2019, the company is targeting 77,000 boe/day of output, roughly unchanged from this year.
|CURRENCIES & YIELDS|
|Suncor Energy||SU||44.26||▲2.7||40.49||55.47||26||D W|
|Imperial Oil||IMO||41.55||▲2.3||33.43||44.91||66||D W|
|Husky Energy||HSE||17.77||▲0.9||15.09||22.99||28||D W|
|Pembina Pipeline||PPL||43.97||▼-0.9||37.60||47.84||70↓||D W|
|Inter Pipeline||IPL||22.80||▲0.8||20.68||27.92||74||D W|
|Gibson Energy||GEI||22.36||▼-1.6||15.68||23.32||98||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||36.36||▲0.8||35.31||49.08||20||D W|
|Cenovus Energy||CVE||10.78||▼-2.4||9.03||14.84||18||D W|
|Seven Generations||VII||12.03||▲0.7||11.57||19.40||9||D W|
|Pason Systems||PSI||21.75||▼-1.0||16.05||24.57||93||D W|
|Mullen Group||MTL||13.23||▼-1.4||13.12||16.93||23||D W|
|Secure Energy||SES||8.05||▼-1.1||6.98||9.82||61||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||37.99||▼-2.7||24.97||47.45||87||D W|
|Exxon Mobil||XOM||77.39||▼-0.8||72.16||89.30||46||D W|
|Kinder Morgan||KMI||16.94||▼-1.4||14.69||19.83||62||D W|
|Williams Co||WMB||24.75||▲1.8||23.54||33.67||27||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||98.07||▼-0.5||96.54||133.53||8||D W|
|Occidental Petro||OXY||70.95||▲0.2||62.47||87.67||29||D W|
|Anadarko Petro||APC||54.40||▼-1.0||46.80||76.70||9||D W|
|Concho Res||CXO||128.79||▲1.0||123.63||163.11||16||D W|
|Ntl-Oilwell Varco||NOV||32.66||▼-0.8||31.47||49.08||4||D W|
|Baker Hughes||BHGE||23.15||▼-2.7||22.55||37.76||1||D W|
|Phillips 66||PSX||95.60||▲0.8||89.14||123.97||14||D W|
|Valero Energy||VLO||82.34||▼-1.5||80.00||126.98||4||D W|
|Marathon Petro||MPC||63.84||▼-0.5||60.10||88.45||9||D W|
CES Energy Solutions (CEU.TO): Upgraded from Buy to Action List Buy at TD Securities.
CNOOC (CEO): Upgraded from Neutral to Outperform at Macquarie.
EQT GP (EQGP): Upgraded from Hold to Overweight at US Capital Advisors.
Pioneer Natural Resources (PXD): Upgraded from Outperform to Strong Buy at Ifs Securities.
EQT (EQT): Downgraded from Equal Weight to Underweight at Morgan Stanley.
UPDATED: DAILY (END-OF-DAY)
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