Energy traders hit the sell button on warnings of slowing global growth

Energy traders hit the sell button on warnings of slowing global growth

Today's energy market summary:

Today's equity market action:

  • After several weeks of solid gains, global equity markets took a big drop on Tuesday, as US traders returned to their desks after Monday's holiday.
  • The Nasdaq and the Dow Transports were the worst performers in US markets, each falling almost 2%. The Dow Jones Industrial gave back over 300 points (-1.2%), while the S&P 500 fell 1.4%. In Toronto, the TSX declined 0.8%.
  • Energy was the worst performing sector in both Canadian and US markets, falling 3.5% on the TSX and 2.2% on the S&P 500. Losses were spread across all subsectors, with producers leading to the downside.
  • The US dollar was unchanged for the day, despite a drop in bond yields. The loonie fell 0.8% on Tuesday.

Today's notable energy news:

  • Tallgrass Energy and Kinder Morgan have agreed to jointly boost crude transport from Wyoming, Colorado, North Dakota and Western Canada into the Cushing storage hub, through new and existing pipelines. The combined system would carry 800,000 bbl/day of light crude and 150,000 bbl/day of heavy crude into Cushing by the second half of 2020.
  • Camp-operator Civeo was awarded two contracts worth about US$90 million, including a 5-year deal for 1,540 room facility with an unnamed oil sands operator. The deal is expected to generate about $100 million in revenues.
  • Natural gas deliveries through Enbridge’s Texas Eastern pipeline have been almost cut in half to about 1.3 Bcf/day, due to yesterday's explosion in southeast Ohio that injured two people. Enbridge says it continues to work with state and federal regulators to determine the cause of the blast.
  • Equinor has halted exploration in the Barents Sea following an incident last week on Seadrill's West Hercules drilling rig. No injuries were reported. The exact cause of the incident is still under investigation.
  • PetroChina warned it will need to take a US$1.5 billion write-down due to the sale of various assets. Fourth quarter revenues were also hit by lower oil prices and higher exploration costs i some of its fields.
  • Western Gas Partners boosted its quarterly dividend to US$0.98 per share, up 2% from the previous quarter and up 7% from the previous year.

Today's Q4/2018 earnings releases and 2019 guidance updates:

  • MEG Energy slashed its 2019 capital budget to just $200 million, less than one-third of its original forecast, setting aside an additional $75 million in growth funds, if market conditions improve. Production is expected to grow just 2% this year to about 90,000 bbl/day, reflecting the Alberta's curtailment program. The company has also revived plans to monetize its partial upgrading technology.
  • EQT Corp is forecasting a 2019 capital budget of about US$2 billion, down from US$2.5 billion spent this year. Fourth quarter production is expected to average 394 Bcfe, up 5% from the previous quarter. Full year 2019 production is expected to average about 1.5 Bcfe.
  • Halliburton reported Q4 revenues of US$5.9 billion, down 4% from the previous quarter. For the full year 2018, revenues came in at US$24 billion, up 16% from the previous year. The company says North American markets have "softened," decreasing demand for its completion services. However, demand remains robust internationally. Halliburton celebrates 100 years of service in 2019.
OIL PRICES - DAILY % CHANGE
WTI DIFFERENTIALS
STREAM CLOSE %CHG L 52WK H
BRENT$61.50▼1.950.47
 
86.29
WTI$52.57▼2.342.53
 
76.41
CDN LT$46.92▼2.620.83
 
69.32
C5+$48.52▼3.137.04
 
71.40
WCS$42.07▼1.212.59
 
56.21

CRUDE OIL FUTURES CURVES
BRENT
WTI
█ JAN 22   █ JAN 15   █ JAN 8   █ DEC 31   (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 +4.4%)
  • Parkland Fuel (PKI +0.3%)
  • TransCanada (TRP +0.2%)
  • 12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • TSX BEARISH INDICATORS
    BOTTOM
    5
  • Crescent Point (CPG -6.6%)
  • Paramount Res (POU -6.4%)
  • Nuvista Energy (NVA -6.1%)
  • Baytex Energy (BTE -6.1%)
  • Cdn Natural Res (CNQ -5.9%)
  • 12-MO LOWS
  • None
  • 10-YR LOWS
  • None
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H CHART
    INTEGRATED
    Suncor EnergySU42.12▼-2.735.53
     
    55.47D   W
    Imperial OilIMO36.56▼-0.433.43
     
    44.91D   W
    Husky EnergyHSE16.38▼-1.913.33
     
    22.99D   W
    MIDSTREAM
    EnbridgeENB47.61▼-1.737.36
     
    49.46D   W
    TransCanadaTRP55.40▲0.247.90
     
    60.22D   W
    Pembina PipelinePPL44.53▼-1.537.60
     
    47.84D   W
    Inter PipelineIPL21.17▼-1.118.60
     
    25.88D   W
    Keyera KEY27.60▼-2.824.05
     
    38.91D   W
    Gibson EnergyGEI19.50▼-2.615.68
     
    23.32D   W
    LARGE CAP E&P
    Cdn Natural ResCNQ34.34▼-5.930.11
     
    49.08D   W
    Cenovus EnergyCVE10.35▼-2.58.74
     
    14.84D   W
    EncanaECA9.03▼-3.06.90
     
    18.54D   W
    TourmalineTOU18.39▼-4.315.84
     
    26.19D   W
    Vermilion EnergyVET32.48▼-1.726.67
     
    50.46D   W
    SERVICES
    Pason SystemsPSI20.69▼-1.816.05
     
    24.57D   W
    EnerflexEFX17.31▼-0.213.55
     
    18.72D   W
    Mullen Group MTL12.33▼-2.511.39
     
    16.93D   W
    ShawcorSCL19.39▲4.415.11
     
    29.50D   W
    Secure EnergySES7.93▼-2.16.25
     
    9.82D   W
    REFINING & MARKETING
    Parkland FuelPKI37.37▲0.327.36
     
    47.45D   W
    S&P 500 ENERGY STOCKS
    SPX BULLISH INDICATORS
    TOP 5
  • None
  • 12-MO HIGHS
  • None
  • 10-YR HIGHS
  • None
  • GOLDEN CROSSES
  • None
  • SPX BEARISH INDICATORS
    BOTTOM
    5
  • EQT Corp (EQT -5.6%)
  • Concho Res (CXO -5.3%)
  • Diamondback (FANG -5.1%)
  • TechnipFMC (FTI -4.4%)
  • EOG Resources (EOG -4.2%)
  • 12-MO LOWS
  • None
  • 10-YR LOWS
  • None
  • DEATH CROSSES
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H CHART
    INTEGRATED
    Exxon MobilXOM71.89▼-1.564.65
     
    89.30D   W
    ChevronCVX112.34▼-1.8100.22
     
    132.67D   W
    MIDSTREAM
    Kinder MorganKMI17.63▼-2.114.62
     
    19.71D   W
    Williams CoWMB26.16▼-0.920.36
     
    33.67D   W
    ONEOKOKE62.58▼-1.050.26
     
    71.99D   W
    LARGE CAP E&P
    ConocoPhillipsCOP65.75▼-3.250.18
     
    80.24D   W
    EOG ResourcesEOG96.86▼-4.282.04
     
    133.53D   W
    Occidental PetroOXY65.12▼-2.956.83
     
    87.67D   W
    Anadarko PetroAPC47.08▼-3.340.40
     
    76.70D   W
    Pioneer Natural ResPXD139.98▼-3.4119.08
     
    213.40D   W
    SERVICES
    SchlumbergerSLB43.96▼-1.734.99
     
    80.35D   W
    HalliburtonHAL31.26▼-3.124.70
     
    57.86D   W
    Baker HughesBHGE23.77▼-1.520.09
     
    37.76D   W
    Ntl-Oilwell VarcoNOV29.54▼-3.024.27
     
    49.08D   W
    TechnipFMCFTI23.02▼-4.418.20
     
    34.97D   W
    REFINERS
    Marathon PetroMPC64.82▼-2.054.29
     
    88.45D   W
    Phillips 66PSX93.00▼-2.478.44
     
    123.97D   W
    Valero EnergyVLO82.01▼-0.768.81
     
    126.98D   W
    HollyFrontierHFC54.35▼-2.942.42
     
    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.A59.62▼-2.455.04
     
    73.86D   W
    TotalTOT53.48▼-2.049.70
     
    65.69D   W
    BPBP40.08▼-1.736.15
     
    47.83D   W
    EniE32.95▼-1.529.75
     
    40.15D   W
    EquinorEQNR22.14▼-2.719.95
     
    28.93D   W
    ANALYST RATINGS

    UPGRADES

    • TechnipFMC (FTI): Upgraded from Underperform to Neutral at BNP Paribas.

    DOWNGRADES

    • Royal Dutch Shell (RDS/A): Downgraded from Equal Weight to Underweight at Morgan Stanley.

    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
    Energy stocks drag markets lower, despite resilience in oil prices

    Energy stocks drag markets lower, despite resilience in oil prices

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