Oil prices post another week of solid gains as concerns linger over Libyan supply

Oil prices post another week of solid gains as concerns linger over Libyan supply

Today's energy market summary:

  • Concerns over Libyan oil supply and a softer US dollar sent oil prices higher on Friday.

  • Brent rose 1% while WTI and the main Canadian benchmarks all gained about 0.5%.

  • For the week, Brent rose almost 2%, posting its fourth week of gains, and solidly holding above US$70 a barrel. WTI rose for the sixth week in a row, a first since early 2016.

  • Heating oil and Henry Hub natural gas prices were little moved on Friday. Gasoline was also roughly unchanged for the day, but posted a decent 3.5% gain for the week.

Today's treasury, currency and equity market action:

  • Better-than-expected Chinese trade data and a positive start to the Q1 earnings season helped lift global bond yields and stock markets on Friday.

  • Except for the yen and greenback, most other global currencies gained ground, including the loonie, which rose back above 75 cents.

  • Most global markets ended Friday in the green. The NYSE rose 0.6% while the NASDAQ gained 0.5%. The S&P 500 Large Cap Index rose 0.7% while the Dow 30 increased 1%. In Toronto, the TSX also rose 0.5%, with most sectors posting gains for the day.

  • Energy stocks rose 0.9% on the TSX but just 0.2% on the S&P 500. Heavy-weight Chevron was a major drag on US markets, while US E&Ps had a spectacular day on expectations for more M&A activity. Independent refiners and integrated ADRs listed on the NYSE mostly declined on Friday.

Today's geopolitical news:

  • In an interview with the Financial Times, the chairman of Libya's National Oil Company says his country's energy sector is facing its biggest crisis in eight years. Mustafa Sanalla says the situation could be much worse than 2011, due to the size of the forces involved. Sanalla warns unless the problem is resolved, as much as 1.2 million bbl/day of Libyan crude could be at risk of coming offline. 

  • The US Treasury Department has imposed sanctions on four shipping companies and nine vessels for violating sanctions against Venezuela. The companies and vessels belong to two Liberian firms, Jennifer Navigation and Lima Shipping, and one Italian tanker company, PB Tankers.


Today's blockbuster deal:

  • Chevron has agreed to buy Anadarko Petroleum for US$33 billion in cash and stock, plus about US$17 billion in debt. Chevron is offering US$65 a share (weighted 75% stock and 25% cash), representing a 37% premium to yesterday's close. The acquisition greatly expands Chevron's footprint in the Permian shale, and strengthens its position in the LNG market. Chevron says it should see US$2 billion in synergies within one-year of closing, and also announced plans to divest US$15 to $20 billion in assets between 2020 and 2022.

  • According to CNBC, Occidental Petroleum had offered more than US$70 per share, but the offer was refused by Anadarko. The deal was more heavily wighted in cash, but subject to shareholder approval, and allegedly has some other "structural" issues. Occidental says it is reviewing its options, which may include a hostile takeover. Chevron's offer is subject to US$1 billion break-up fee.

  • If successful, the Anadarko deal will be the largest since Shell's US$53 billion acquisition of BG Group, and the 11th largest energy merger in history.

Today's notable energy news:

  • According to Baker Hughes, the US put three new oil rigs into service this week, bringing the total to 833. Canada lost another 4 rigs, leaving only 18 oil rigs in service.

  • Gas prices in Vancouver hit a record $1.69 a litre this week, blamed on refinery maintance on the West Coast. BC’s NDP government added another 1¢ in carbon taxes on April 1st, but Premier Horgan says taxes aren’t completely to blame for high prices at the pump.

  • According to Argus, TransCanada's 2.6 Bcf/day Sur de Texas-Tuxpan pipeline from the US to Mexico should come online by the summer, a year later than originally planned. Gas will be sourced from Enbridge's 2.6 Bcf/day Valley Crossing Pipeline, which is already up and running. Once operational, Sur de Texas-Tuxpan will be the largest cross-border gas pipeline by volume. The line runs mostly underwater through the Gulf of Mexico, and is jointly owned with Sempra Energy subsidiary IEnova.

  • ExxonMobil says crude purchased from the US Strategic Petroleum Reserves (SPR) contained "extremely high levels" of hydrogen sulphide, allegedly up to 250 times higher than government standards. Exxon purchased 1.5 million barrels of heavy sour crude from SPR last August. Shell, Macquarie and PetroChina have made similar complaints to the US Department of Energy, which were mostly dismissed.

  • Petrobras has cancelled plans to raise the price of diesel by 5.7%, at the request of Brazilian President Jair Bolsonaro. High diesel prices prompted a violent trucker's strike last year, sending much of the country into chaos. The government intervened, forcing Petrobras to sell their diesel at a loss, sending shares tumbling, and prompting the resignation of former CEO Pedro Parente. The state-owned oil major has long complained of government intervention, accusing politicians of "dangerous populism."

  • Marathon Petroleum has purchased a 900,000 barrel storage terminal and 33 retail stations in Buffalo, NY, from fuel distributor NOCO. Financial terms of the deal were not disclosed.

  • McDermott International announced a "large" contract from Qatargas for EPC and installation work on the expansion of its offshore North Field in Qatar.

OIL PRICES - DAILY % CHANGE
WTI DIFFERENTIALS
STREAM CLOSE %CHG L 52WK H
BRENT$71.55▲1.050.47
 
86.29
WTI$63.89▲0.542.53
 
76.41
CDN LT$60.12▲0.520.83
 
69.32
C5+$59.76▲0.537.04
 
71.40
WCS$55.42▲0.512.59
 
56.30

CRUDE OIL FUTURES CURVES
BRENT
WTI
█ APR 12   █ APR 5   █ MAR 29   █ MAR 22   (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
  • Encana (ECA +5.3%)
  • Crescent Point (CPG +5.2%)
  • Vermilion Energy (VET +3.3%)
  • Whitecap Res (WCP +2.3%)
  • Ensign Energy Svcs (ESI +2.2%)
  • 12-MO HIGHS
  • Enbridge (ENB +0.6%)
  • TSX BEARISH INDICATORS
    BOTTOM
    5
  • Secure Energy (SES -2.7%)
  • Mullen Group (MTL -2.7%)
  • CES Energy (CEU -1.7%)
  • Husky Energy (HSE -1.5%)
  • Shawcor (SCL -0.9%)
  • 12-MO LOWS
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H CHART
    INTEGRATED
    Suncor EnergySU44.22▲0.835.53
     
    55.47D   W
    Imperial OilIMO38.77▲0.133.52
     
    44.91D   W
    Husky EnergyHSE14.16▼-1.513.21
     
    22.99D   W
    MIDSTREAM
    EnbridgeENB49.93▲0.637.36
     
    49.94D   W
    TransCanadaTRP62.05▲0.247.90
     
    62.37D   W
    Pembina PipelinePPL50.04▼0.039.15
     
    50.48D   W
    Inter PipelineIPL22.26▼0.018.60
     
    25.66D   W
    Keyera KEY32.73▲0.124.05
     
    38.91D   W
    Gibson EnergyGEI23.66▲0.916.15
     
    23.75D   W
    LARGE CAP E&P
    Cdn Natural ResCNQ39.76▲0.430.11
     
    49.08D   W
    Cenovus EnergyCVE13.190.08.74
     
    14.84D   W
    EncanaECA10.08▲5.36.90
     
    18.54D   W
    TourmalineTOU21.58▲0.415.84
     
    26.19D   W
    Vermilion EnergyVET35.13▲3.326.67
     
    49.67D   W
    SERVICES
    Pason SystemsPSI20.71▲1.717.18
     
    24.57D   W
    EnerflexEFX19.62▲0.313.55
     
    20.38D   W
    Mullen Group MTL12.08▼-2.711.26
     
    16.93D   W
    ShawcorSCL20.55▼-0.915.11
     
    28.89D   W
    Secure EnergySES8.42▼-2.76.25
     
    9.44D   W
    REFINING & MARKETING
    Parkland FuelPKI40.12▲1.028.78
     
    47.45D   W
    S&P 500 ENERGY STOCKS
    SPX BULLISH INDICATORS
    TOP 5
  • Anadarko Petro (APC +32%)
  • Pioneer Natural Res (PXD +11.5%)
  • Concho Res (CXO +8.8%)
  • Devon Energy (DVN +7.4%)
  • Noble Energy (NBL +6.9%)
  • 12-MO HIGHS
  • Cabot O&G (COG +0.9%)
  • SPX BEARISH INDICATORS
    BOTTOM
    5
  • Ntl-Oilwell Varco (NOV -8.4%)
  • Chevron (CVX -4.9%)
  • Occidental Petro (OXY -2.8%)
  • Marathon Petro (MPC -2.4%)
  • Phillips 66 (PSX -1.4%)
  • 12-MO LOWS
  • None
  • COMPANY TICKER CLOSE %CHG L 52WK H CHART
    INTEGRATED
    Exxon MobilXOM80.92▼-1.364.65
     
    87.36D   W
    ChevronCVX119.76▼-4.9100.22
     
    131.08D   W
    MIDSTREAM
    Kinder MorganKMI19.82▼-0.514.62
     
    20.44D   W
    Williams CoWMB28.94▲0.620.36
     
    32.22D   W
    ONEOKOKE70.60▲0.850.26
     
    71.99D   W
    LARGE CAP E&P
    ConocoPhillipsCOP67.37▲1.556.75
     
    80.24D   W
    EOG ResourcesEOG105.31▲6.782.04
     
    133.53D   W
    Occidental PetroOXY65.33▼-2.856.83
     
    87.67D   W
    Anadarko PetroAPC61.78▲32.040.40
     
    76.70D   W
    Pioneer Natural ResPXD168.32▲11.5119.08
     
    213.40D   W
    SERVICES
    SchlumbergerSLB45.65▲0.834.99
     
    75.43D   W
    HalliburtonHAL31.33▲0.424.70
     
    54.91D   W
    Baker HughesBHGE26.38▼-1.120.09
     
    37.76D   W
    Ntl-Oilwell VarcoNOV26.87▼-8.424.27
     
    49.08D   W
    TechnipFMCFTI24.67▼-0.218.20
     
    34.39D   W
    REFINERS
    Marathon PetroMPC61.59▼-2.454.29
     
    88.45D   W
    Phillips 66PSX97.17▼-1.478.44
     
    123.97D   W
    Valero EnergyVLO88.41▼-0.868.81
     
    126.98D   W
    HollyFrontierHFC50.25▼-0.546.75
     
    83.28D   W
    NYSE ADRs
    COMPANY TICKER CLOSE %CHG L 52WK H CHART
    Royal Dutch ShellRDS.A64.50▼-0.755.04
     
    73.86D   W
    TotalTOT56.34▼-0.149.70
     
    65.69D   W
    BPBP44.67▼-0.536.28
     
    47.83D   W
    EniE35.59▼-0.529.75
     
    40.15D   W
    EquinorEQNR23.05▲0.319.95
     
    28.93D   W
    ANALYST RATINGS

    UPGRADES

    • Chevron (CVX): Upgraded from Neutral to Buy at BofA.

    • Murphy Oil (MUR): Upgraded from Sell to Neutral at Goldman Sachs.

    DOWNGRADES

    • Chesapeake Energy (CHK): Downgraded from Neutral to Sell at Goldman Sachs.

    • California Resources (CRC): Downgraded from Neutral to Sell at Goldman Sachs.

    • Whiting Petroleum (WLL): Downgraded from Overweight to Equal 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 markets kick-off the new week on a sour note

    Energy markets kick-off the new week on a sour note

    Energy markets hit the pause button on Thursday

    Energy markets hit the pause button on Thursday

    0