Falling equity markets drag oil prices lower

Falling equity markets drag oil prices lower

Today's energy market summary:

  • Oil prices followed equity markets lower on Monday, on renewed concerns over the health of the Chinese economy.
  • Brent and WTI declined about 3%, with Brent dipping below the US$60 mark for the fist time in two weeks.
  • In Canadian energy markets, the discount on Canadian Light narrowed by US$1.40, falling to US$4.25/bbl. The discount on Canadian heavy widened slightly, ending Monday just below US$10.
  • Henry Hub natural gas prices tumbled 6.5%, returning to the lows of last September.
  • Gasoline and heating oil also declined, falling about 4% and 3%, respectively.
  • The Trump Administration announced sanctions against Venezuela's state-owned oil producer PDVSA, in hopes of pressuring President Maduro into stepping down. The government has frozen all US-based assets belonging to PDVSA, including its largest asset, refiner Citgo Petroleum. For now, the US has backed down on threats to impose sanctions on Venezuelan crude exports.

Today's equity market action:

  • Equity markets opened sharply lower on Monday after bellwethers Caterpillar and Nvidia both missed earnings expectations, due to slowing demand in China.
  • European markets gave up 1%, due in part to a rising Euro, while Chinese markets were mostly unchanged. Most US indices also declined about 1% for the day.
  • The Dow Jones Industrial sank 200 points, while the S&P 500 gave up 0.8%, with technology stocks posting the largest losses. In Toronto, the TSX managed a 0.1% gain, helped by a good showing among gold and cannabis stocks.
  • The energy sectors declined 0.6% in Canada and 1% in US markets. Canadian midstream stocks had a good day, but most other subsectors ended Monday in the red.

Today's other notable energy news:

  • Black Diamond Group has been cleared to proceed on its previously announced contract with West Moberly First Nations to provide a 908-bed workcamp for the Coastal GasLink Pipeline Project. The $42.5 million contract is expected to last 27 months. Aside from Coastal GasLink, Black Diamond was also awarded a 304-bed contract in Kitimat for initial infrastructure work.
  • According to Reuters, ExxonMobil has approved a major expansion of its 365,000 bbl/day Beaumont Refinery in Texas, adding a third processing plant and almost doubling the size of the facility. The company has yet to confirm or deny the rumours, or provide any capital estimates.
  • Baker Hughes says it plans to reduce its CO₂ emissions 50% by 2030, achieving "net-zero CO₂ equivalent" emissions by 2050.  The company also committed to assisting its customers with reducing their own carbon footprints.
  • Italy’s Eni and Austria’s OMV have each agreed to pay a combined US$5.8 billion for 35% a stake in Abu Dhabi National Oil Company’s (ADNOC) refining business, and establishing a new trading arm, to be jointly owned by the three partners. The deal boosts ADNOC’s access to European markets.
  • Saudi Aramco announced plans to invest up to US$1.6 billion for a 20% stake in South Korean refiner Hyundai Oilbank. The deal is expected to boost Aramco's market share in Asia and Africa.
  • Oilfield services firm McDermott International was awarded a "sizeable" contract by LLOG Exploration for a deepwater project in the Gulf of Mexico.
  • Hi-Crush Partners announced a long-term agreement with CNX Resources to supply frac sand for its operations in the Marcellus and Utica shale basins. Financial terms of the deal were not disclosed.
  • Marathon Petroleum boosted its quarterly dividend 15% to US$0.53 per share.
OIL PRICES - DAILY % CHANGE
WTI DIFFERENTIALS
STREAM CLOSE %CHG L 52WK H
BRENT$59.93▼2.850.47
 
86.29
WTI$51.99▼3.242.53
 
76.41
CDN LT$47.74▼0.620.83
 
69.32
C5+$47.94▼3.437.04
 
71.40
WCS$42.09▼4.612.59
 
56.21

CRUDE OIL FUTURES CURVES
BRENT
WTI
█ JAN 28   █ JAN 21   █ JAN 14   █ JAN 7   (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
  • Shawcor (SCL +2.3%)
  • TORC O&G (TOG +1.6%)
  • Seven Generations (VII +1.5%)
  • Pembina Pipeline (PPL +1.2%)
  • Vermilion Energy (VET +0.5%)
  • 12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • TSX BEARISH INDICATORS
    BOTTOM
    5
  • Advantage O&G (AAV -6.2%)
  • Gran Tierra (GTE -4.7%)
  • Paramount Res (POU -4.6%)
  • Tamarack Valley (TVE -4.2%)
  • Crescent Point (CPG -4.2%)
  • 12-MO LOWS
  • None
  • 10-YR LOWS
  • None
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H CHART
    INTEGRATED
    Suncor EnergySU42.20▼-0.435.53
     
    55.47D   W
    Imperial OilIMO36.74▼-0.733.43
     
    44.91D   W
    Husky EnergyHSE15.57▼-2.613.33
     
    22.99D   W
    MIDSTREAM
    EnbridgeENB47.82▲0.237.36
     
    48.45D   W
    TransCanadaTRP55.21▼-0.247.90
     
    59.51D   W
    Pembina PipelinePPL45.41▲1.237.60
     
    47.84D   W
    Inter PipelineIPL21.04▲0.118.60
     
    25.66D   W
    Keyera KEY27.45▼-0.124.05
     
    38.91D   W
    Gibson EnergyGEI19.44▲0.415.68
     
    23.32D   W
    LARGE CAP E&P
    Cdn Natural ResCNQ34.76▼-0.430.11
     
    49.08D   W
    Cenovus EnergyCVE10.31▲0.38.74
     
    14.84D   W
    EncanaECA9.18▼-0.76.90
     
    18.54D   W
    TourmalineTOU18.02▼-2.215.84
     
    26.19D   W
    Vermilion EnergyVET31.07▲0.526.67
     
    49.67D   W
    SERVICES
    Pason SystemsPSI20.47▲0.516.05
     
    24.57D   W
    EnerflexEFX17.06▼-0.613.55
     
    18.72D   W
    Mullen Group MTL12.13▲0.311.39
     
    16.93D   W
    ShawcorSCL19.78▲2.315.11
     
    29.26D   W
    Secure EnergySES7.89▼-0.86.25
     
    9.71D   W
    REFINING & MARKETING
    Parkland FuelPKI35.90▼-1.227.36
     
    47.45D   W
    S&P 500 ENERGY STOCKS
    SPX BULLISH INDICATORS
    TOP 5
  • Kinder Morgan (KMI +0.9%)
  • Apache (APA +0.7%)
  • 12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • SPX BEARISH INDICATORS
    BOTTOM
    5
  • EQT Corp (EQT -3.1%)
  • Devon Energy (DVN -2.8%)
  • Halliburton (HAL -2.7%)
  • HollyFrontier (HFC -2.6%)
  • Hess Corp (HES -2.6%)
  • 12-MO LOWS
  • None
  • 10-YR LOWS
  • None
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H CHART
    INTEGRATED
    Exxon MobilXOM71.24▼-0.764.65
     
    89.30D   W
    ChevronCVX112.17▼-0.9100.22
     
    131.75D   W
    MIDSTREAM
    Kinder MorganKMI17.89▲0.914.62
     
    18.99D   W
    Williams CoWMB26.58▼-0.320.36
     
    32.75D   W
    ONEOKOKE62.29▼-0.250.26
     
    71.99D   W
    LARGE CAP E&P
    ConocoPhillipsCOP65.35▼-2.550.18
     
    80.24D   W
    EOG ResourcesEOG98.10▼-1.082.04
     
    133.53D   W
    Occidental PetroOXY66.08▼-0.756.83
     
    87.67D   W
    Anadarko PetroAPC46.45▼-0.940.40
     
    76.70D   W
    Pioneer Natural ResPXD139.71▼-0.4119.08
     
    213.40D   W
    SERVICES
    SchlumbergerSLB44.24▼-1.734.99
     
    78.18D   W
    HalliburtonHAL31.23▼-2.724.70
     
    55.96D   W
    Baker HughesBHGE22.98▼-2.220.09
     
    37.76D   W
    Ntl-Oilwell VarcoNOV29.95▼-1.624.27
     
    49.08D   W
    TechnipFMCFTI22.85▼-1.918.20
     
    34.43D   W
    REFINERS
    Marathon PetroMPC63.72▼-0.654.29
     
    88.45D   W
    Phillips 66PSX92.50▼-0.678.44
     
    123.97D   W
    Valero EnergyVLO81.03▼-1.468.81
     
    126.98D   W
    HollyFrontierHFC53.63▼-2.642.42
     
    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.A58.61▼-1.055.04
     
    73.86D   W
    TotalTOT53.59▼-1.149.70
     
    65.69D   W
    BPBP39.57▼-1.436.15
     
    47.83D   W
    EniE33.05▼-0.529.75
     
    40.15D   W
    EquinorEQNR22.00▼-1.619.95
     
    28.93D   W
    ANALYST RATINGS

    UPGRADES

    • Diamond Offshore Drilling (DO): Upgraded from Hold to Buy at Pareto Securities.

    • Noble (NE): Upgraded from Hold to Buy at Pareto Securities.

    DOWNGRADES

    • C&J Energy Services (CJ): Downgraded from Buy to Hold at Jefferies Financial.

    • DCP Midstream (DCP): Downgraded from Buy to Hold at Jefferies Financial.

    • Magellan Midstream Partners (MMP): Downgraded from Buy to Hold at Jefferies Financial.

    • Phillips 66 Partners (PSXP): Downgraded from Buy to Hold at Jefferies Financial.

    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
    WCS discount falls below US$9 for the first time since spring 2017

    WCS discount falls below US$9 for the first time since spring 2017

    Oil prices get a lift as US dollar takes a dive on Friday

    Oil prices get a lift as US dollar takes a dive on Friday

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