Threats of sanctions against Venezuelan crude narrows discount on Canadian heavy

Threats of sanctions against Venezuelan crude narrows discount on Canadian heavy

Today's energy market summary:

  • Despite a major increase in US crude oil stockpiles, WTI gained 1% today as traders mull the potential impact of sanctions against Venezuela's crude exports.
  • US refineries purchase about 400,000 bbl/day of mostly heavy crude, a majority imported into the US Gulf Coast. If imposed, the sanctions would dramatically boost demand for Canadian heavy crude. The heavy oil discount narrowed to below US$10 a barrel today, sending Western Canadian Select (WCS) higher by almost 3%.
  • According to the Energy Information Administration, US imports of Canadian crude surged to a new record high of 4.1 million bbl/day last week, signalling very strong demand. Crude stockpiles rose 8 million barrels overall, the first significant increase in almost two months.

Today in treasury, currency and equity markets:

  • Weak economic data out of Europe, the continued US government shutdown and concerns over China/US trade negotiations sent US bond yields lower today, particularly on the longer end of the curve. Canadian bond yields also declined.
  • The US dollar jumped 0.6% on Thursday, returning to the highs of early January. The Euro and Aussie dollar declined 0.7%, while most other currencies were unchanged for the day.
  • Equity markets continue to be very subdued, with the Dow Jones Industrial Average and NYSE ending Thursday roughly unchanged. The S&P 500 edged up 0.1%, while the TSX rose 0.5%.
  • The TSX energy sector rose 1.5%, with gains seen across most subsectors. The SPX energy sector gained 0.6%, held back by weakness in refining stocks.

Today's notable energy news:

  • BP announced an investment with PowerShare, developer of electric vehicle charging stations in China. According to BP, China is the world's largest market for electric vehicles.
  • Talos Energy completed its first phase of exploration in the Zama block, located offshore Mexico. The company says work on Zama-2 was completed ahead of schedule and under-budget, revealing a reservoir "similar or better" to Zama-1. The block is jointly owned with Mexico's Sierra Oil and Gas and London-based Premier Oil.
  • Calgary-based TransGlobe Energy announced a 4% decline in 2018 total proved plus probable (2P) reserves, falling to 44.1 million barrels of oil equivalent. Reserves rose in Egypt, while Canadian holdings in the Cardium declined due to low gas prices.
  • Valero Energy boosted its quarterly dividend by US$0.10 to US$0.90 per share.
OIL PRICES - DAILY % CHANGE
WTI DIFFERENTIALS
STREAM CLOSE %CHG L 52WK H
BRENT$61.09▼0.150.47
 
86.29
WTI$53.13▲1.042.53
 
76.41
CDN LT$47.48▲1.120.83
 
69.32
C5+$49.08▲1.137.04
 
71.40
WCS$43.78▲2.712.59
 
56.21

CRUDE OIL FUTURES CURVES
BRENT
WTI
█ JAN 24   █ JAN 17   █ JAN 10   █ JAN 3   (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
  • Gran Tierra (GTE +3.6%)
  • Tamarack Valley (TVE +3.4%)
  • Advantage O&G (AAV +3.1%)
  • Freehold Royalties (FRU +3%)
  • Encana (ECA +2.8%)
  • 12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • TSX BEARISH INDICATORS
    BOTTOM
    5
  • Precision Drilling (PD -2.3%)
  • Altagas (ALA -2.3%)
  • Parkland Fuel (PKI -1.5%)
  • Vermilion Energy (VET -0.9%)
  • Gibson Energy (GEI -0.7%)
  • 12-MO LOWS
  • None
  • 10-YR LOWS
  • None
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H CHART
    INTEGRATED
    Suncor EnergySU42.30▲1.935.53
     
    55.47D   W
    Imperial OilIMO36.65▲0.433.43
     
    44.91D   W
    Husky EnergyHSE15.79▼-0.613.33
     
    22.99D   W
    MIDSTREAM
    EnbridgeENB47.55▼0.037.36
     
    49.16D   W
    TransCanadaTRP55.12▲0.547.90
     
    59.51D   W
    Pembina PipelinePPL44.21▲0.737.60
     
    47.84D   W
    Inter PipelineIPL20.95▲1.318.60
     
    25.70D   W
    Keyera KEY26.79▲1.824.05
     
    38.91D   W
    Gibson EnergyGEI19.14▼-0.715.68
     
    23.32D   W
    LARGE CAP E&P
    Cdn Natural ResCNQ34.96▲2.130.11
     
    49.08D   W
    Cenovus EnergyCVE10.17▲0.58.74
     
    14.84D   W
    EncanaECA9.26▲2.86.90
     
    18.54D   W
    TourmalineTOU18.49▲1.315.84
     
    26.19D   W
    Vermilion EnergyVET30.46▼-0.926.67
     
    50.25D   W
    SERVICES
    Pason SystemsPSI20.69▲0.216.05
     
    24.57D   W
    EnerflexEFX17.24▲0.213.55
     
    18.72D   W
    Mullen Group MTL12.180.011.39
     
    16.93D   W
    ShawcorSCL19.87▲2.115.11
     
    29.50D   W
    Secure EnergySES8.07▲1.16.25
     
    9.82D   W
    REFINING & MARKETING
    Parkland FuelPKI36.03▼-1.527.36
     
    47.45D   W
    S&P 500 ENERGY STOCKS
    SPX BULLISH INDICATORS
    TOP 5
  • Helmerich & Payne (HP +3.7%)
  • Apache (APA +2.7%)
  • Williams Co (WMB +2.6%)
  • Newfield Expl (NFX +2.6%)
  • Ntl-Oilwell Varco (NOV +2.2%)
  • 12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • SPX BEARISH INDICATORS
    BOTTOM
    5
  • Marathon Petro (MPC -2.7%)
  • Phillips 66 (PSX -1.4%)
  • Noble Energy (NBL -1.3%)
  • Valero Energy (VLO -1%)
  • EQT Corp (EQT -0.8%)
  • 12-MO LOWS
  • None
  • 10-YR LOWS
  • None
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H CHART
    INTEGRATED
    Exxon MobilXOM71.40▲0.164.65
     
    89.30D   W
    ChevronCVX113.51▲1.9100.22
     
    132.67D   W
    MIDSTREAM
    Kinder MorganKMI17.48▲1.414.62
     
    19.56D   W
    Williams CoWMB26.50▲2.620.36
     
    33.67D   W
    ONEOKOKE62.65▲0.250.26
     
    71.99D   W
    LARGE CAP E&P
    ConocoPhillipsCOP66.12▲0.450.18
     
    80.24D   W
    EOG ResourcesEOG97.24▲0.782.04
     
    133.53D   W
    Occidental PetroOXY64.98▲0.656.83
     
    87.67D   W
    Anadarko PetroAPC46.25▲0.840.40
     
    76.70D   W
    Pioneer Natural ResPXD138.31▲0.7119.08
     
    213.40D   W
    SERVICES
    SchlumbergerSLB43.56▲0.634.99
     
    79.25D   W
    HalliburtonHAL31.21▲0.524.70
     
    56.84D   W
    Baker HughesBHGE23.04▲0.320.09
     
    37.76D   W
    Ntl-Oilwell VarcoNOV29.38▲2.224.27
     
    49.08D   W
    TechnipFMCFTI22.86▲1.218.20
     
    34.97D   W
    REFINERS
    Marathon PetroMPC63.11▼-2.754.29
     
    88.45D   W
    Phillips 66PSX91.33▼-1.478.44
     
    123.97D   W
    Valero EnergyVLO78.95▼-1.068.81
     
    126.98D   W
    HollyFrontierHFC53.85▼-0.742.42
     
    83.28D   W
    NYSE ADRs
    ADRs BULLISH INDICATORS
    12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • ADRs BEARISH INDICATORS
    12-MO LOWS
  • None
  • 10-YR LOWS
  • None
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H CHART
    Royal Dutch ShellRDS.A58.84▼-0.155.04
     
    73.86D   W
    TotalTOT53.34▲0.749.70
     
    65.69D   W
    BPBP40.11▼0.036.15
     
    47.83D   W
    EniE32.60▲0.029.75
     
    40.15D   W
    EquinorEQNR22.18▲1.519.95
     
    28.93D   W
    ANALYST RATINGS

    UPGRADES

    • Canadian Natural Resources (CNQ.TO): Upgraded from Hold to Buy at Tudor Pickering.

    • MEG Energy (MEG.TO): Upgraded to Buy at Tudor Pickering.

    DOWNGRADES

    • None

    LATEST ENERGY NEWS

    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
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