Brent prices deteriorate, following WTI to new 14-month low

Brent prices deteriorate, following WTI to new 14-month low

Today's energy market summary:

  • Despite a decent showing in US equity markets, oil prices continued to weaken on Tuesday, along with most other energy commodities.

  • Brent decisively broke through all major supports on Tuesday, tumbling almost 6% and now returning to the lows of October 2017. WTI also declined over 7% on renewed concerns of rising US crude stockpiles.

  • According to the American Petroleum Institute (API), crude inventories are expected to have increased by 3.5 million barrels last week. Official data from the Energy Information Administration (EIA) is due Wednesday morning.

  • The Western Canadian Select (WCS) discount to WTI narrowed by US$1.25 to US$16.60/bbl, a level not seen since mid-May. Discounts for Canadian Light and Edmonton Condensate (C5+) were unchanged.

  • Gasoline and heating oil also declined 4.6% and 4.0%, respectively. Henry Hub recouped all of yesterday's losses, gaining almost 9%.

Today's equity market action:

  • Stock markets waffled on Tuesday, opening higher but selling off towards the end of the trading day. Markets anxiously await tomorrow's interest rate announcement from the US Federal Reserve.

  • The feds have repeatedly telegraphed intensions to raise rates, but may be forced to backtrack given the recent yield curve inversion and sharp sell-off in global equity markets. Most global bond yields declined again on Tuesday.

  • In Toronto, the TSX rose 0.4%, with heavy losses in energy stocks offsetting gains in most other sectors. The S&P 500 ended the day unchanged. Equity markets in Europe and Asia, including Japan, posted large declines overnight.

  • The US energy sector was the worst hit sector on Tuesday, declining 2.3% with almost all SPX large-cap energy components posting losses for the day. The TSX energy sector declined 1.1%, with E&Ps again leading to the downside.

  • Foreign ADRs listed on the NYSE also declined on Tuesday, with many falling to new 1-year lows.

Today's 2019 guidance updates:

  • Whitecap Resources (WCP.TO -6.8%) announced a 2019 capital budget of about $450 million, which includes plans to drill 220 new wells. The capex spend and dividend payouts are expected to be fully funded from operating cash flows. Full year 2019 output is expected to average about 71,000 boe/day. The company says it has now hedged about 40% of next year's crude production at an average price of $74/bbl.

  • Diamondback Energy (FANG -0.7%) announced a 2019 capital budget of US$2.7 to US$3.1 billion, with production guidance set at 275-290,000 boe/day, weighted about 70% liquids. The company also announced a 50% dividend increase, rising to US$0.75 per share annually starting in Q1/2019, subject to board approval.

Today's notable energy news:

  • Husky Energy (HSE.TO +0.6%) has received all regulatory approvals for its $6.4 billion takeover of MEG Energy (MEG.TO +1.3%). Husky calls its $11/share offer "full and fair." MEG has been shopping around for a better deal, but none has materialized so far. Husky's offer is open to acceptance until January 16.

  • Britain's Buzzard oilfield, located in the North Sea, finally restarted production after being offline for several weeks to repair a corroded pipe. Buzzard produces about 150,000 bbl/day, accounting for 13% of total UK production and 30% of flows in the Forties pipeline. The field is operated by Nexen Energy, a subsidiary of China's CNOOC (CEO -4.3%).

  • CNOOC also announced the signing of "Strategic Cooperation Agreements" for oil and gas exploration off the coast of China with 9 international oil companies, including Chevron (CVX -2.4%), ConocoPhillips (COP -1.9%), Equinor (EQNR -3.1%), Husky Energy (HSE.TO +0.6%), Royal Dutch Shell (RDS.A -1.2%), Total (TOT -2.4%), Kuwait's KUFPEC, Australia's Roc Oil and South Korea's SK Innovation.

OIL PRICES - DAILY % CHANGE
WTI DIFFERENTIALS
STREAM CLOSE %CHG L 52WK H
BRENT$56.26▼5.656.26
 
86.29
WTI$46.24▼7.346.24
 
76.41
CDN LT$36.59▼9.020.83
 
69.32
C5+$43.19▼7.837.04
 
71.40
WCS$29.64▼7.512.59
 
56.21
CRUDE OIL FUTURES CURVES
BRENT
WTI
█ DEC 18   █ DEC 11   █ DEC 4   █ NOV 27   (USD/BBL)
MARKET OVERVIEW
MARKETS
CURRENCIES & YIELDS
    TSX SECTORS
52-WK
    SPX SECTORS
52-WK
ENERGY SECTORS

TSX ENERGY SUB-SECTORS

SPX ENERGY SUB-SECTORS
TSX ENERGY STOCKS
TSX BULLISH INDICATORS
TOP 5
  • PrairieSky (PSK +3.2%)
  • Enerflex (EFX +2.5%)
  • Ensign Energy Svcs (ESI +1.4%)
  • MEG Energy (MEG +1.3%)
  • Gran Tierra (GTE +0.7%)
  • 12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • TSX BEARISH INDICATORS
    BOTTOM
    5
  • Baytex Energy (BTE -9.1%)
  • Tamarack Valley (TVE -7.1%)
  • Whitecap Res (WCP -6.8%)
  • Birchcliff Energy (BIR -4.9%)
  • Trican Well Svc (TCW -4.4%)
  • 12-MO LOWS
  • Suncor Energy (SU -0.3%)
  • Inter Pipeline (IPL +0.1%)
  • Encana (ECA -2.1%)
  • Tourmaline (TOU -1.6%)
  • Vermilion Energy (VET -3.5%)
  • Enerplus (ERF -3.7%)
  • ARC Resources (ARX -3.9%)
  • Parex Resources (PXT -3.6%)
  • Whitecap Res (WCP -6.8%)
  • Peyto Exploration (PEY -2%)
  • Baytex Energy (BTE -9.1%)
  • TORC O&G (TOG -1.7%)
  • Freehold Royalties (FRU -1.4%)
  • Paramount Res (POU -3%)
  • Birchcliff Energy (BIR -4.9%)
  • Precision Drilling (PD -2.9%)
  • Ensign Energy Svcs (ESI +1.4%)
  • Tamarack Valley (TVE -7.1%)
  • Advantage O&G (AAV -2.1%)
  • 10-YR LOWS
  • Tourmaline (TOU -1.6%)
  • ARC Resources (ARX -3.9%)
  • Whitecap Res (WCP -6.8%)
  • Peyto Exploration (PEY -2%)
  • Freehold Royalties (FRU -1.4%)
  • Birchcliff Energy (BIR -4.9%)
  • Precision Drilling (PD -2.9%)
  • Ensign Energy Svcs (ESI +1.4%)
  • Advantage O&G (AAV -2.1%)
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H RANK  CHARTS
    INTEGRATED
    Suncor EnergySU38.98▼-0.338.55
     
    55.4719D   W
    Imperial OilIMO35.05▼-0.133.43
     
    44.9125D   W
    Husky EnergyHSE14.84▲0.614.62
     
    22.9917D   W
    MIDSTREAM
    EnbridgeENB41.38▼-1.337.36
     
    51.0467D   W
    TransCanadaTRP51.35▼-1.948.92
     
    62.3149D   W
    Pembina PipelinePPL42.85▼-0.237.60
     
    47.8464D   W
    Inter PipelineIPL19.82▲0.119.50
     
    27.6026D   W
    Keyera KEY27.56▼-0.727.27
     
    38.9121D   W
    Gibson EnergyGEI18.69▼-0.415.68
     
    23.3271D   W
    LARGE CAP E&P
    Cdn Natural ResCNQ33.00▼-0.532.08
     
    49.0822D   W
    Cenovus EnergyCVE9.52▼-3.49.03
     
    14.8419D   W
    EncanaECA7.53▼-2.17.51
     
    18.543D   W
    TourmalineTOU15.96▼-1.615.87
     
    26.1912D   W
    Vermilion EnergyVET27.01▼-3.526.90
     
    50.467D   W
    SERVICES
    Pason SystemsPSI18.35▼-1.316.05
     
    24.5737D   W
    EnerflexEFX15.70▲2.513.55
     
    18.7289D   W
    ShawcorSCL17.19▼-0.216.66
     
    29.5010D   W
    Mullen Group MTL12.01▼-0.111.93
     
    16.9324D   W
    Secure EnergySES6.88▼-3.66.72
     
    9.8233↓D   W
    REFINING & MARKETING
    Parkland FuelPKI34.25▲0.626.34
     
    47.4561D   W
    S&P 500 ENERGY STOCKS
    SPX BULLISH INDICATORS
    TOP 5
  • Cabot O&G (COG +1.5%)
  • Ntl-Oilwell Varco (NOV +0.4%)
  • Marathon Petro (MPC +0.2%)
  • 12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • SPX BEARISH INDICATORS
    BOTTOM
    5
  • Anadarko Petro (APC -4.9%)
  • Hess Corp (HES -4.9%)
  • Concho Res (CXO -4.5%)
  • Devon Energy (DVN -4.3%)
  • ONEOK (OKE -3.6%)
  • 12-MO LOWS
  • Exxon Mobil (XOM -2.8%)
  • Williams Co (WMB -2.4%)
  • EOG Resources (EOG -2.3%)
  • Anadarko Petro (APC -4.9%)
  • Concho Res (CXO -4.5%)
  • Schlumberger (SLB -3.1%)
  • Ntl-Oilwell Varco (NOV +0.4%)
  • TechnipFMC (FTI -2.7%)
  • Phillips 66 (PSX -1.3%)
  • Valero Energy (VLO -2.1%)
  • Pioneer Natural Res (PXD -1%)
  • Marathon Oil (MRO -3.3%)
  • Apache (APA -3.1%)
  • Devon Energy (DVN -4.3%)
  • Noble Energy (NBL -3%)
  • Diamondback (FANG -0.7%)
  • Cimarex Energy (XEC -2.4%)
  • Helmerich & Payne (HP -3.4%)
  • 10-YR LOWS
  • Apache (APA -3.1%)
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H RANK  CHARTS
    INTEGRATED
    Exxon MobilXOM72.00▼-2.871.62
     
    89.3045D   W
    ChevronCVX109.74▼-2.4107.54
     
    133.8850D   W
    MIDSTREAM
    Kinder MorganKMI15.53▼-2.014.69
     
    19.8344D   W
    Williams CoWMB22.42▼-2.422.26
     
    33.6726D   W
    ONEOKOKE56.47▼-3.651.28
     
    71.9932D   W
    LARGE CAP E&P
    ConocoPhillipsCOP61.91▼-1.950.18
     
    80.2452D   W
    EOG ResourcesEOG94.01▼-2.393.71
     
    133.5321D   W
    Occidental PetroOXY63.14▼-1.562.47
     
    87.6722D   W
    Anadarko PetroAPC47.13▼-4.947.05
     
    76.707D   W
    Concho ResCXO104.90▼-4.5104.36
     
    163.118D   W
    SERVICES
    SchlumbergerSLB37.84▼-3.137.67
     
    80.351D   W
    HalliburtonHAL28.98▼-0.428.17
     
    57.867D   W
    Ntl-Oilwell VarcoNOV26.45▲0.426.24
     
    49.082D   W
    Baker HughesBHGE21.22▼-1.920.81
     
    37.766D   W
    TechnipFMCFTI19.16▼-2.718.95
     
    35.002D   W
    REFINERS
    Marathon PetroMPC58.96▲0.258.13
     
    88.4523D   W
    Phillips 66PSX84.73▼-1.384.29
     
    123.9717D   W
    Valero EnergyVLO71.06▼-2.170.67
     
    126.984D   W
    HollyFrontierHFC52.39▼-0.642.42
     
    83.2813D   W
    NYSE ADRs
    ADRs BULLISH INDICATORS
    12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • ADRs BEARISH INDICATORS
    12-MO LOWS
  • Royal Dutch Shell (RDS.A -1.2%)
  • Total (TOT -2.4%)
  • Eni (E -0.8%)
  • PetroChina (PTR -3.4%)
  • Sasol Limited (SSL -2.4%)
  • 10-YR LOWS
  • None
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H RANK  CHARTS
    Royal Dutch ShellRDS.A57.01▼-1.256.79
     
    73.867D   W
    TotalTOT52.70▼-2.452.39
     
    65.6952D   W
    BPBP37.82▼-1.536.15
     
    47.8342D   W
    EniE31.12▼-0.831.04
     
    40.1540D   W
    EquinorEQNR21.26▼-3.120.16
     
    28.9325D   W
    ANALYST RATINGS

    UPGRADES

    • None

    DOWNGRADES

    • None


    UPDATED: DAILY (END-OF-DAY)

    SOURCES:
    • OIL PRICES REFLECT NEAR MONTH CONTRACT FROM THE NYMEX/CME GROUP
    • EQUITY PRICES PROVIDED BY NYSE & TMX GROUP
    • CHARTPACKS COURTESY STOCKCHARTS.COM (DIVIDEND ADJUSTED)

    NOTES:
    • 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

    RANK:
    • 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.
    Oil prices recoup some of yesterday's losses on better-than-expected drawdowns in US stockpiles

    Oil prices recoup some of yesterday's losses on better-than-expected drawdowns in US stockpiles

    Oil prices sink along with global equity markets, as WTI hits 14-month low

    Oil prices sink along with global equity markets, as WTI hits 14-month low

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