Oil prices continue downtrend as API predicts another build in US crude stockpiles
Today's energy market summary:
Both Brent and WTI took a 1.4% haircut today, as markets digest the reinstatement of Iranian sanctions and API reported another 8 million barrel build in US crude stockpiles. Official US inventory numbers from the EIA are due Wednesday morning.
Canadian Light was the worst hit today, falling almost 5% as the discount to WTI widened slightly.
US equity markets mostly posted gains on Tuesday, as investors await results from today's midterm election. The S&P 500 rose 0.6%, while the Dow gained 0.7%. Gains were broadly based across all subsectors.
In Toronto, the TSX rose 0.5%, with industrial stocks the only losing sector for the day.
The TSX/SPX energy sectors rose 0.6% and 0.3%, respectively, with Canadian midstream names posting the largest gains.
Today's notable energy news:
Imperial Oil (IMO.TO -0.1%) announced a positive final investment decision on its $2.6 billion Aspen in-situ project. The 75,000 bbl/day facility is expected to produce first oil in 2022. The news was released after the markets closed on Tuesday.
US federal regulators have granted Williams Co (WMB +0.1%) two more years to get approvals for its long-delayed Constitution natural gas pipeline from Pennsylvania to New York. WMB was denied a water quality permit in New York State, and since embarked on a legal challenge to get construction started. Constitution is co-owned with Cabot Oil & Gas (COG -0.5%), Duke Energy (DUK +0.9%) and AltaGas (ALA.TO +6.7%).
Today's third quarter earnings on the TSX:
Keyera Corp (KEY.TO +1.9%) reported adjusted net earnings of $160 million in the third quarter, up 16% y/y. Cash flow from operations declined 14% to $69.4 million. Gathering and throughput volumes were roughly unchanged at 1.48 Bcf/day of gas and 183,000 bbl/day of liquids (gross).
Gibson Energy (GEI.TO +2.1%) posted a net profit of $6.8 million in Q3, versus a $5.4 million loss for the same time last year. Revenues rose 65% to $2.1 billion.
Pipe manufacturer Shawcor (SCL.TO +2.2%) posted a net profit of $10.6 million, down 45% from the same quarter last year. Revenues dipped 11% y/y to $351 million, blamed in part on "unexpected negative supply chain and regulatory environment influences."
Today's US/global energy earnings:
Devon Energy (DVN -0.5%) posted net earnings of US$2.5 billion in Q3, including proceeds from various asset sales. Core earnings totalled US$324 million for the quarter while revenues rose 34% y/y to US$2.6 billion. Total production declined 1% to 522,000 boe/day, mainly due to divested natural gas assets.
Pioneer Natural Resources (PXD +0.2%) posted a 54% increase in Q3 revenues, rising to US$1.3 billion, as production rose 16% to 320,659 boe/day. Q3 profits rose to US$411 million, including a US$118 million impairment charge, versus a US$23 million loss for the same time last year.
Plains All American (PPA +1.7%) posted a net profit of US$710 million in Q3, versus a US$33 million profit for the same time last year. Revenues rose almost 50% to US$8.8 billion.
Third quarter revenues at Oasis Petroleum (OAS -3.2%) rose 79% y/y to US$547 million, as total production rose 29% y/y to 85,400 boe/day, weighted 77% liquids. Profits rose to US$62.3 million, up from a US$41.2 million loss for the same time last year.
Q3 profits at Petrobras (PBR -3.4%) rose to US$1.8 billion on revenues of US$24.9 billion. The Brazilian oil major averaged 2.5 million boe/day of total upstream production during the quarter, down about 5% y/y.
|CURRENCIES & YIELDS|
|Imperial Oil||IMO||42.19||▼-0.1||33.43||44.91||79||D W|
|Husky Energy||HSE||18.44||▲0.4||15.09||22.99||34||D W|
|Pembina Pipeline||PPL||45.55||▲1.1||37.60||47.84||89||D W|
|Inter Pipeline||IPL||22.21||▼-0.2||20.68||27.92||54||D W|
|Gibson Energy||GEI||22.22||▲2.1||15.68||23.04||97||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||39.12||▲1.9||35.31||49.08||28||D W|
|Cenovus Energy||CVE||11.90||▲0.9||9.03||14.84||29||D W|
|Seven Generations||VII||13.89||▼-0.9||12.82||21.25||15||D W|
|Pason Systems||PSI||19.69||▼-0.9||16.05||22.10||57||D W|
|Mullen Group||MTL||13.78||▼-0.1||13.43||16.95||21||D W|
|Secure Energy||SES||8.53||▲0.2||6.98||9.82||86||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||41.70||▲4.3||24.97||47.45||96||D W|
|Exxon Mobil||XOM||81.99||▲0.4||72.16||89.30||60||D W|
|Kinder Morgan||KMI||17.45||▲1.1||14.69||19.83||67||D W|
|Williams Co||WMB||25.74||▲0.1||23.54||33.67||39||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||107.33||▲0.9||96.54||133.53||19||D W|
|Occidental Petro||OXY||73.34||▲4.9||62.47||87.67||33||D W|
|Anadarko Petro||APC||54.77||▲0.2||46.80||76.70||5||D W|
|Concho Res||CXO||141.37||▼-0.4||123.63||163.11||34||D W|
|Ntl-Oilwell Varco||NOV||36.87||▲1.0||31.47||49.08||14||D W|
|Baker Hughes||BHGE||27.16||▲1.2||25.53||37.76||4||D W|
|Phillips 66||PSX||100.88||▲0.4||89.14||123.97||18||D W|
|Valero Energy||VLO||91.28||▲0.1||80.00||126.98||6||D W|
|Marathon Petro||MPC||68.37||▼-2.0||60.10||88.45||14||D W|
Crew Energy (CR.TO): Upgraded from Neutral to Buy at Eight Capital.
Enbridge (ENB.TO): Upgraded from Market Perform to Outperform at Wells Fargo.
Ensign Energy (ESI.TO): Upgraded from Sector Underperform to Sector Perform at Scotia Capital.
Kosmos Energy (KOS): Upgraded from Neutral to Buy at Goldman Sachs.
CVR Energy (CVI): Downgraded from Buy to Neutral at Goldman Sachs.
Encana (ECA.TO): Downgraded to Market Perform at BMO.
PBF Logistics (PBFX): Downgraded from Outperform to Market Perform at Wells Fargo.
Shell Midstream Partners (SHLX): Downgraded from Outperform to Sector Perform at RBC.
UPDATED: DAILY (END-OF-DAY)
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