Energy stocks hit new lows as oil prices continue to trend sideways
Today's energy market summary:
Oil prices continue to tread water, giving back all of yesterday's gains on Friday. Today's declines were blamed on weak economic data out of China and the EU, causing traders to hit the sell button on riskier assets.
Brent gave back 2%, while WTI fell 2.6%. Canada's light and heavy oil benchmarks declined over 3%, despite no change in the Canadian differentials. January contracts for WCS, Canadian Light and Edmonton Condensate (C5+) all expired on Friday.
Gasoline also declined 3%, while heating oil gave fell almost 2%. Natural gas prices took a major correction on Friday, falling over 7%.
Aside from WCS, oil prices have been trending sideways since the beginning of the month.
Baker Hughes reported another weekly decline in rig counts, falling by four in the US and seven in Canada. Canada also lost five natural rigs this week.
Today's equity market action:
Weak retail sales data out of China overnight sent equity markets into a tailspin on Friday morning, with indices in China, Japan and the US falling an average of 2%.
The Dow Jones Industrial sank 500 points while the S&P 500 declined 2.1%. In Toronto, the TSX fell 1% for the day, ending the week lower by 1.4%.
Energy stocks pulled back sharply on Friday. The TSX energy sector declined 3.1% while the US energy basket fell 2.4%. Declines were across all subsectors, with service providers once again leading to the downside.
Despite a major improvement in Canadian oil prices in recent weeks, the TSX energy sector ended Friday back at the lows of February 2016.
Today's notable fresh 52-week lows include Suncor Energy (SU.TO -3.3%), Husky Energy (HSE.TO -1.2%), Marathon Petroleum (MPC -3.6%) and Phillips 66 (PSX -2.3%).
Today's notable energy news:
Suncor Energy (SU.TO -3.3%) says it plans to boost total output 10% in 2019, rising to about 800,000 boe/day. Next year's guidance assumes production out of Alberta will be constrained due to the province's recently announced curtailment program. Overall capital spending will remain unchanged next year, forecasted to be between $4.9 and $5.6 billion. About two-thirds of those funds will be dedicated towards maintenance and sustaining capital.
Michigan Governor Rick Snyder has signed a series of agreements with Enbridge (ENB.TO -0.8%) for the construction of a tunnel under the Straits of Mackinac, which will house the company's Line 5. The Republican governor leaves office at the end of the month, to be replaced by a Democrat, who has denounced the tunnel and the pipeline.
Phillips 66 (PSX -2.3%) announced a 2019 capital program of US$2.3 billion, excluding expenditures for its MLP Phillips 66 Partners (PSXP +0.5%). About US$1.6 billion will be spent on its midstream business unit, with another US$1 billion allocated towards its refining segment. The company says it aims to reinvest 60% of its cash flow back into the business, while the remaining 40% will be returned to shareholders in the form of share buybacks and dividends.
ExxonMobil (XOM -1.8%) and Angola's state-owned Sonangol signed an exploration MOU for three blocks in the Namibe Basin. XOM has been operating in the country for more than 25 years. Angola is Africa's second-largest oil producer but has been facing steep declines in recent years. Oil accounts for 95% of the country's exports and around 70% of government revenues.
|CURRENCIES & YIELDS|
|Suncor Energy||SU||39.62||▼-3.3||39.28||55.47||20||D W|
|Imperial Oil||IMO||34.78||▼-2.1||33.43||44.91||20||D W|
|Husky Energy||HSE||15.37||▼-1.2||15.24||22.99||19||D W|
|Pembina Pipeline||PPL||43.91||▼-0.8||37.60||47.84||75||D W|
|Inter Pipeline||IPL||20.26||▼-0.6||20.22||27.74||29||D W|
|Gibson Energy||GEI||19.37||▼-2.2||15.68||23.32||87||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||34.28||▼-2.9||32.08||49.08||28||D W|
|Cenovus Energy||CVE||10.26||▼-3.2||9.03||14.84||30||D W|
|Vermilion Energy||VET||28.92||▼-4.1||28.83||50.46||10||D W|
|Pason Systems||PSI||18.58||▼-2.6||16.05||24.57||40||D W|
|Mullen Group||MTL||12.29||▼-0.1||11.93||16.93||27↑||D W|
|Secure Energy||SES||7.22||▼-1.4||6.72||9.82||51||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||36.17||▼-2.3||26.34||47.45||90||D W|
|Exxon Mobil||XOM||75.58||▼-1.8||72.16||89.30||57||D W|
|Kinder Morgan||KMI||16.17||▼-1.5||14.69||19.83||57||D W|
|Williams Co||WMB||23.45||▼-1.7||23.35||33.67||38||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||100.08||▼-2.7||96.54||133.53||39||D W|
|Occidental Petro||OXY||65.10||▼-2.4||62.47||87.67||29||D W|
|Anadarko Petro||APC||50.95||▼-2.9||47.37||76.70||18||D W|
|Concho Res||CXO||115.02||▼-4.7||114.40||163.11||25||D W|
|Ntl-Oilwell Varco||NOV||26.68||▼-3.0||26.53||49.08||2||D W|
|Baker Hughes||BHGE||21.45||▼-2.6||20.81||37.76||6||D W|
|Marathon Petro||MPC||59.87||▼-3.6||59.55||88.45||22||D W|
|Phillips 66||PSX||86.83||▼-2.3||86.47||123.97||18||D W|
|Valero Energy||VLO||73.30||▼-0.2||71.48||126.98||5||D W|
Callon Petroleum (CPE): Downgraded from Buy to Hold at Tudor Pickering.
Carrizo Oil & Gas (CRZO): Downgraded from Buy to Hold at Tudor Pickering.
Centennial Resource Development (CDEV): Downgraded from Buy to Hold at Tudor Pickering.
Extraction Oil & Gas (XOG): Downgraded from Buy to Hold at Tudor Pickering.
PDC Energy (PDCE): Downgraded from Buy to Hold at Tudor Pickering.
SM Energy (SM): Downgraded from Buy to Hold at Tudor Pickering.
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.