Falling stock markets drag oil prices lower, as WTI erases all gains for the year
Today's energy market summary:
Oil prices took another beating on Tuesday, as the recent sell-off in global markets continues. Both Brent and WTI declined 6%, with the US benchmark ending the day at a 1-year low. The Canadian light and heavy benchmarks both fell over 11%.
The WCS discount to WTI narrowed by US$1/bbl, after Alberta Premier Rachel Notley announced plans to develop "short and medium-term solutions" to narrow the price gap. The province is also leaving the door open to government-mandated production cuts.
Gasoline, heating oil and natural gas also participated in the meltdown. Wholesale gasoline prices fell another 6%, now down 30% from the highs of early October. Heating oil sank another 4.6%, posting a 20% loss in the past two months.
According to the American Petroleum Institute (API), crude stockpiles are expected to have declined 1.55 million barrels last week. Official numbers from the Energy Information Administration (EIA) are due on Wednesday morning. The EIA has so far reported 8 consecutive weeks of inventory builds.
The Dow Jones Industrial was the biggest loser in US equity markets on Tuesday, falling over 550 points or 2.2%. The S&P 500 declined 1.8%. Most US indices have now wiping out all gains for the year. The TSX touched a 2-year low, falling 1.3%.
Energy was once again the worst performing sector on both sides of the border, falling 2.9% on the TSX and 3.3% on the S&P 500. Declines were broadly based across all subsectors. Foreign ADRs listed on the NYSE also ended the day lower.
Today's notable energy news:
Husky Energy (HSE.TO -5.6%) is continuing its investigation into last Friday's spill at its White Rose platform off the coast of Newfoundland. The facility was producing 20,000 bbl/day (net to Husky), prior to the shutdown on November 15. The company has not yet provided a timeline for restart.
Minnesota state regulators have rejected a motion to reconsider their approval of Enbridge's (ENB.TO +0.3%) plan to replace Line 3, and stood behind their certificate of need, awarded last June.
TransCanada (TRP.TO +1.1%) has stopped construction of two natural gas pipelines in central Mexico due to numerous delays, runaway permit costs and allegations of extortion. The company says it is re-evaluating routings for the two projects.
Royal Dutch Shell's (RDS.A -2.8%) 210,000 bbl/day Convent refinery in Louisiana may be shutdown for as long two months, after a hot spot was discovered in a hydrocracker unit. A 40-day maintenance turnaround, originally planned for next June, has now been advanced in order to repair the unit.
|CURRENCIES & YIELDS|
|Suncor Energy||SU||42.98||▼-0.5||40.49||55.47||26||D W|
|Imperial Oil||IMO||39.69||▼-4.4||33.43||44.91||49||D W|
|Husky Energy||HSE||15.93||▼-5.6||15.09||22.99||14||D W|
|Pembina Pipeline||PPL||44.68||▼-0.3||37.60||47.84||85↑||D W|
|Inter Pipeline||IPL||22.52||▼-1.1||20.68||27.92||65||D W|
|Gibson Energy||GEI||21.66||▼-1.8||15.68||23.32||98||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||35.04||▼-2.3||34.75||49.08||18||D W|
|Cenovus Energy||CVE||9.94||▼-6.2||9.03||14.84||12||D W|
|Seven Generations||VII||11.63||▼-2.9||11.51||19.40||8||D W|
|Pason Systems||PSI||21.41||▼-2.0||16.05||24.57||93||D W|
|Mullen Group||MTL||13.18||▼-0.2||13.01||16.93||27||D W|
|Secure Energy||SES||8.00||▼-3.4||6.98||9.82||68||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||37.29||▲1.0||25.02||47.45||88||D W|
|Exxon Mobil||XOM||76.97||▼-2.8||72.16||89.30||54||D W|
|Kinder Morgan||KMI||16.96||▼-2.6||14.69||19.83||72||D W|
|Williams Co||WMB||24.65||▼-2.8||23.54||33.67||39||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||102.36||▼-3.2||96.54||133.53||27||D W|
|Occidental Petro||OXY||70.30||▼-4.2||62.47||87.67||37||D W|
|Anadarko Petro||APC||52.35||▼-5.9||46.80||76.70||8||D W|
|Concho Res||CXO||133.87||▼-3.7||123.63||163.11||48||D W|
|Ntl-Oilwell Varco||NOV||31.82||▼-3.0||31.48||49.08||6||D W|
|Baker Hughes||BHGE||22.41||▼-2.5||21.90||37.76||3||D W|
|Phillips 66||PSX||92.54||▼-2.5||89.14||123.97||17||D W|
|Valero Energy||VLO||78.61||▼-2.6||78.00||126.98||4||D W|
|Marathon Petro||MPC||61.89||▼-2.4||60.64||88.45||11||D W|
BP (BP): Upgraded from Market Perform to Outperform at Raymond James.
EQM Midstream Partners (EQM): Upgraded from Peer Perform to Outperform at Wolfe Research.
EQT (EQT): Upgraded from Neutral to Buy at Goldman Sachs.
UPDATED: DAILY (END-OF-DAY)
• OIL PRICES REFLECT NEAR MONTH CONTRACT FROM THE NYMEX/CME GROUP
• EQUITY PRICES PROVIDED BY NYSE & TMX GROUP
• CHARTPACKS COURTESY STOCKCHARTS.COM (DIVIDEND ADJUSTED)
• OIL PRICES, FUTURES AND DIFFERENTIALS IN USD/BBL
• C5+ = EDMONTON CONDENSATE
• FUTURES CURVES SHOW PRICES FOR NEAR-MONTH CONTRACT (C1) AND NEXT 5-MONTHS (C2-C6)
• TSX SHARE PRICES IN CAD; S&P 500 PRICES IN USD
• ADR: AMERICAN DEPOSITORY RECEIPTS LISTED ON NYSE IN USD
• SHARE PRICE CHANGES (INCL. NEW HIGHS & LOWS) EXCLUDE DIVIDENDS
• BASED ON STOCKCHARTS TECHNICAL RANK (SCTR)
• REFLECTS RELATIVE STRENGTH AMONG OTHER ENERGY STOCKS (PERCENTILE RANKING)
• RISING RANK (↑) REFLECTS INCREASING RELATIVE STRENGTH
• FALLING RANK (↓) REFLECTS DECREASING RELATIVE STRENGTH.