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

Today's energy market summary:

  • After yesterday's sharp sell-off, Brent and WTI recovered about 2% on Wednesday, thanks to a better-than-expected US inventory report.

  • According to the US Energy Information Administration (EIA), total commercial crude stockpiles declined by 500,000 barrels, despite a 1 million barrel increase in Cushing.

  • The EIA also reported a 4.2 million barrel decline in distillate inventories and 1.8 million barrel increased in gasoline stockpiles. Gasoline prices rose 2% while heating oil gained 3%.

  • The differential on Canadian heavy crude narrowed by another US$0.60/bbl, ending Wednesday at US$16 and sending WCS prices up 5%. 

  • According to the Libyan government, production out of the El Sharara oilfield is poised to restart, after being taken offline 10 days ago due to dispute with workers. The government has pledged about US$700 million to improve living conditions among workers. El Sharara and neighbouring fields produce about 400,000 bbl/day.

Today's equity market action:

  • After surging higher Wednesday morning, US equity markets nosedived after the Federal Reserves raised interest rates by 25 basis points to 2.5%. 

  • The Fed also took a much less aggressive stance on future rate hikes, and cut its 2019 growth forecast from 2.5 to 2.3%. Two more rate hikes are expected in 2019. The news sent yields on 30-year notes back to 3% and 10-year yields back to the lows of last April. 

  • The Dow Jones Industrial ended the day down another 350 points (-1.5%), closing at a new low for the year. The small cap Russell 2000 Index and Nasdaq were the worst performers, falling over 2%.

  • The broader S&P 500 fell 1.5%, with declines seen across all sectors, including energy which shed another 1.3%.

  • In Toronto, the TSX declined 1%, with gold and healthcare stocks leading to the downside. The TSX energy sector was roughly unchanged for the day.

Today's notable energy news:

  • BP (BP -0.5%) has launched the sale of various US onshore assets recently purchased from Australia's BHP (BHP -0.6%). The assets, located in Oklahoma, Wyoming, East Texas and along the Colorado-New Mexico border, are estimated to be worth US$3 billion and generate US$700 million in cash flow annually.

  • Altus Midstream (ALTM -2.6%) has exercised an option to buy a 15% stake in the Gulf Coast Express pipeline, leaving operator Kinder Morgan (KMI +0.3%) with a 35% stake. DCP Midstream (DCP -0.9%) and Targa Resources (TRGP -0.1%) each retain a 25% stake in the project. The US$1.75 billion pipeline will transport up 2 Bcf/day of natural gas from the Permian Basin to the Texas Gulf Coast. The line is currently under construction and expected to begin service in October 2019.

  • Bloomberg is reporting that a group of investors, including Stonepeak Infrastructure Partners and Toronto's Brookfield Asset Management (BAM/A.TO -1.9%) is in talks to buy pipeline operator Tallgrass Energy (TGE +13.7%). Tallgrass has an estimated market cap of about US$6.5 billion.

  • A Brazilian court has moved to block Petrobras' (PBR -1.6%) planned sale of its upstream assets, casting doubt on its many other divestitures. The company had planned to divest another US$27 billion in assets over the next five years as part of its ongoing debt-reduction program. The lawsuit was filed by a worker’s union.

OIL PRICES - DAILY % CHANGE
WTI DIFFERENTIALS
STREAM CLOSE %CHG L 52WK H
BRENT$57.24▲1.756.26
 
86.29
WTI$47.20▲2.146.24
 
76.41
CDN LT$37.55▲2.620.83
 
69.32
C5+$43.45▲0.637.04
 
71.40
WCS$31.20▲5.312.59
 
56.21
CRUDE OIL FUTURES CURVES
BRENT
WTI
█ DEC 19   █ DEC 12   █ DEC 5   █ NOV 28   (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
  • Tamarack Valley (TVE +10.9%)
  • Baytex Energy (BTE +8.5%)
  • Crescent Point (CPG +6.9%)
  • Vermilion Energy (VET +6.8%)
  • TORC O&G (TOG +6%)
  • 12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • TSX BEARISH INDICATORS
    BOTTOM
    5
  • Shawcor (SCL -4%)
  • Trican Well Svc (TCW -2.8%)
  • Gran Tierra (GTE -2.6%)
  • Secure Energy (SES -2.3%)
  • Husky Energy (HSE -2.2%)
  • 12-MO LOWS
  • Suncor Energy (SU -1.5%)
  • Husky Energy (HSE -2.2%)
  • Shawcor (SCL -4%)
  • Secure Energy (SES -2.3%)
  • Parex Resources (PXT +2.8%)
  • Peyto Exploration (PEY -0.6%)
  • Paramount Res (POU +1%)
  • Birchcliff Energy (BIR +1.5%)
  • Ensign Energy Svcs (ESI -0.5%)
  • 10-YR LOWS
  • Peyto Exploration (PEY -0.6%)
  • Birchcliff Energy (BIR +1.5%)
  • Ensign Energy Svcs (ESI -0.5%)
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H RANK  CHARTS
    INTEGRATED
    Suncor EnergySU38.41▼-1.538.10
     
    55.4719D   W
    Imperial OilIMO35.04▼0.033.43
     
    44.9128D   W
    Husky EnergyHSE14.52▼-2.214.44
     
    22.9916D   W
    MIDSTREAM
    EnbridgeENB42.44▲2.637.36
     
    51.0483D   W
    TransCanadaTRP52.17▲1.648.92
     
    62.3163D   W
    Pembina PipelinePPL42.36▼-1.137.60
     
    47.8464D   W
    Inter PipelineIPL19.80▼-0.119.50
     
    26.7429D   W
    Keyera KEY27.43▼-0.527.27
     
    38.9124D   W
    Gibson EnergyGEI18.48▼-1.115.68
     
    23.3272D   W
    LARGE CAP E&P
    Cdn Natural ResCNQ32.59▼-1.232.08
     
    49.0823D   W
    Cenovus EnergyCVE9.39▼-1.49.03
     
    14.8420D   W
    EncanaECA7.69▲2.17.51
     
    18.543D   W
    TourmalineTOU16.20▲1.515.87
     
    26.1913D   W
    Vermilion EnergyVET28.84▲6.826.90
     
    50.4613D   W
    SERVICES
    Pason SystemsPSI18.21▼-0.816.05
     
    24.5737D   W
    EnerflexEFX15.66▼-0.313.55
     
    18.7289D   W
    ShawcorSCL16.50▼-4.016.49
     
    29.508D   W
    Mullen Group MTL12.03▲0.211.93
     
    16.9327D   W
    Secure EnergySES6.72▼-2.36.66
     
    9.8232↓D   W
    REFINING & MARKETING
    Parkland FuelPKI33.84▼-1.226.34
     
    47.4559↓D   W
    S&P 500 ENERGY STOCKS
    SPX BULLISH INDICATORS
    TOP 5
  • Diamondback (FANG +3%)
  • Newfield Expl (NFX +2.9%)
  • Phillips 66 (PSX +0.5%)
  • Pioneer Natural Res (PXD +0.4%)
  • Kinder Morgan (KMI +0.3%)
  • 12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • SPX BEARISH INDICATORS
    BOTTOM
    5
  • Helmerich & Payne (HP -6.8%)
  • Halliburton (HAL -4.7%)
  • Hess Corp (HES -2.8%)
  • Marathon Oil (MRO -2.7%)
  • Devon Energy (DVN -2.3%)
  • 12-MO LOWS
  • Exxon Mobil (XOM -1.7%)
  • Chevron (CVX -1.7%)
  • Williams Co (WMB -0.4%)
  • EOG Resources (EOG -1.1%)
  • Occidental Petro (OXY -1.4%)
  • Anadarko Petro (APC -0.7%)
  • Concho Res (CXO -0.1%)
  • Schlumberger (SLB -0.1%)
  • Halliburton (HAL -4.7%)
  • Ntl-Oilwell Varco (NOV -0.9%)
  • Phillips 66 (PSX +0.5%)
  • Valero Energy (VLO -0.1%)
  • Marathon Oil (MRO -2.7%)
  • Apache (APA -1.7%)
  • Devon Energy (DVN -2.3%)
  • Noble Energy (NBL -2.2%)
  • Cimarex Energy (XEC -1.7%)
  • Helmerich & Payne (HP -6.8%)
  • 10-YR LOWS
  • Apache (APA -1.7%)
  • Noble Energy (NBL -2.2%)
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H RANK  CHARTS
    INTEGRATED
    Exxon MobilXOM70.78▼-1.770.30
     
    89.3042D   W
    ChevronCVX107.83▼-1.7107.10
     
    133.8848D   W
    MIDSTREAM
    Kinder MorganKMI15.57▲0.314.69
     
    19.8351D   W
    Williams CoWMB22.32▼-0.422.12
     
    33.6728D   W
    ONEOKOKE55.89▼-1.051.28
     
    71.9933D   W
    LARGE CAP E&P
    ConocoPhillipsCOP61.28▼-1.050.18
     
    80.2456D   W
    EOG ResourcesEOG92.98▼-1.192.30
     
    133.5323D   W
    Occidental PetroOXY62.24▼-1.461.52
     
    87.6724D   W
    Anadarko PetroAPC46.79▼-0.746.49
     
    76.709D   W
    Concho ResCXO104.78▼-0.1103.06
     
    163.1112D   W
    SERVICES
    SchlumbergerSLB37.79▼-0.137.31
     
    80.351D   W
    HalliburtonHAL27.64▼-4.727.30
     
    57.864D   W
    Ntl-Oilwell VarcoNOV26.21▼-0.925.88
     
    49.083D   W
    Baker HughesBHGE21.04▼-0.920.81
     
    37.768D   W
    TechnipFMCFTI19.10▼-0.318.95
     
    35.003D   W
    REFINERS
    Marathon PetroMPC58.63▼-0.558.13
     
    88.4528D   W
    Phillips 66PSX85.16▲0.584.16
     
    123.9723D   W
    Valero EnergyVLO70.98▼-0.170.24
     
    126.987D   W
    HollyFrontierHFC51.52▼-1.742.42
     
    83.2815D   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 -0.2%)
  • Total (TOT -0.9%)
  • PetroChina (PTR -2.6%)
  • 10-YR LOWS
  • None
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H RANK  CHARTS
    Royal Dutch ShellRDS.A56.90▼-0.256.59
     
    73.869D   W
    TotalTOT52.21▼-0.951.92
     
    65.6952D   W
    BPBP37.65▼-0.536.15
     
    47.8345D   W
    EniE31.24▲0.431.04
     
    40.1550D   W
    EquinorEQNR21.41▲0.820.16
     
    28.9332D   W
    ANALYST RATINGS

    UPGRADES

    • Baker Hughes (BHGE): Upgraded from Neutral to Outperform at Credit Suisse.

    DOWNGRADES

    • Antero Resources (AR): Downgraded from Outperform to Underperform at Raymond James.

    • C&J Energy Services (CJ): Downgraded from Outperform to Neutral at Credit Suisse.

    • Core Laboratories (CLB): Downgraded from Outperform to Neutral at Credit Suisse.

    • FTS International (FTSI): Downgraded from Outperform to Neutral at Credit Suisse.

    • Laredo Petroleum (LPI): Outperform to Neutral at Credit Suisse.

    • Oasis Petroleum (OAS): Outperform to Neutral at Credit Suisse.

    • Patterson-UTI Energy (PTEN): Outperform to Neutral at Credit Suisse.

    • Rowan Companies (RDC): Outperform to Neutral at Credit Suisse.

    • Schlumberger (SLB): Outperform to Neutral at Credit Suisse.

    • Superior Energy Services (SPN): Outperform to Neutral at Credit Suisse.


    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.
    Another ugly day in markets as investors dump stocks, commodities, treasuries and the US dollar

    Another ugly day in markets as investors dump stocks, commodities, treasuries and the US dollar

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

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