Oil prices dip despite outage of major Russian export pipeline
Today's energy market action:
Outage of a major Russian export pipeline sent Brent above US$75 a barrel on Thursday, for the first time since late October. Both Brent and WTI settled lower by the end of the day.
Gasoline and heating oil were little changed, while Henry Hub rose 2%.
Today's treasury, currency and equity market action:
Global bond yields declined across the board on Thursday, as traders await first quarter GDP numbers from the US Department of Commerce on Friday morning.
The Swedish Krona tanked again on Thursday, plunging to a fresh 17-year low. The US dollar eked out another 0.2% gain, closing out Thursday above 98 for the first time since May 2017. The loonie was unchanged for the day.
Global stock markets posted mixed results on Thursday. The NYSE, S&P 500 and TSX were little changed for the day.
The TSX and SPX energy sectors posted a second consecutive day of losses, falling 0.3% in the US, and 0.7% in Canada.
Today's notable energy news:
Poland and Germany have suspended imports of Russian crude shipped on the 730,000 bbl/day Druzhba pipeline, due to serious quality concerns. The stoppage has disrupted oil shipment to major European refineries, including those owned by Total, Eni, Shell and Rosneft. Pipeline operator Transneft says it plans to resume shipment, of clean crude, by the end of the month.
Korea National Oil Corp (KNOC) has hired Scotiabank to help find a partner for a 30% stake of its UK subsidiary Dana Petroleum. The stake is estimated to be worth up to US$550 million. Dana produces about 65,000 boe/day, mostly out of the North Sea, and was purchased by KNOC for US$2.9 billion in 2010.
According to Reuters, US investment firms KKR and BlackRock are raising US$3 billion to purchase a 40% stake in Abu Dhabi's ADNOC Oil Pipelines, a network of 18 pipelines, transporting crude and condensate from ADNOC’s production facilities.
China's CNOOC announced an agreement with Russian gas producer JSC Novatek, for the purchase of a 10% stake in the Arctic LNG 2 project. The LNG terminal consists of three trains, and is located on Russia's Gydan Peninsula.
Today's notable first quarter earnings results:
Precision Drilling posted a net profit of $25 million in the first quarter, excluding a $24 million impairment charge on the sale of Mexican drilling equipment. Revenues rose 8% y/y to $434 million, while funds from operating activities declined 8% to $96 million. Precision's US operations saw a 23% increase, while activity in Canada declined 33% from Q1/2019.
Vermilion Energy reported a Q1 profit of $39.5 million, up almost 60% from the same quarter last year. Funds from operations also rose about 60% y/y to $254 million. First quarter production averaged 103,404 boe/day, up 2% from the previous quarter.
Anadarko Petroleum reported a first quarter loss of US$15 million, on revenues of US$3.2 billion. Cash flow from operations declined 21% y/y to US$1.13 billion. First quarter production averaged 715,000 boe/day, weighted 58% liquids, including a record 166,000 boe/day out of the Gulf of Mexico. The company says it is still working towards a FID for its massive Mozambique LNG project by this summer.
Valero Energy reported a net profit of US$141 million, down from US$469 million for the same time last year. Revenues declined 8% to US$24.3 billion. The company says refining margins were hit by higher pricing for Canadian crude and the loss of Venezuelan imports. Valero processed 2.9 million bbl/day of crude in Q1, while refinery utilization was reported at 91%.
Hess posted a net profit of US$32 million in the first quarter of 2019, up from a net loss of US$106 million for the same time last year. The company says it benefitted from higher US production, which partially offset lower realized oil prices. Excluding Libya, the company averaged 278,000 boe/day in Q1, up 19% y/y. Almost half of those barrels came from the Bakken region.
TechnipFMC posted a first quarter profit of US$20.9 million, on revenues of US$2.9 billion. Orders totalled US$6.2 billion in Q1, the highest since the fourth quarter of 2014.
Driller Helmerich & Payne reported a profit of US$61 million for the first quarter, on revenues on US$741 million. Cash flow from operations dipped 4% to US$200 million.
|Suncor Energy||SU||44.71||▲0.8||35.53||55.47||D W|
|Imperial Oil||IMO||39.94||▲0.2||33.52||44.91||D W|
|Husky Energy||HSE||14.42||▼-1.0||13.21||22.99||D W|
|Pembina Pipeline||PPL||49.54||▼-0.4||39.15||50.65||D W|
|Inter Pipeline||IPL||22.25||▼-0.1||18.60||25.66||D W|
|Gibson Energy||GEI||22.39||▼-3.1||16.15||23.75||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||40.71||▼-1.3||30.11||49.08||D W|
|Cenovus Energy||CVE||13.73||▼-0.1||8.74||14.84||D W|
|Vermilion Energy||VET||35.76||▼-0.4||26.67||49.67||D W|
|Pason Systems||PSI||20.13||▼-2.2||17.18||24.57||D W|
|Mullen Group||MTL||12.19||▲3.1||11.26||16.93||D W|
|Secure Energy||SES||8.36||▼-0.2||6.25||9.44||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||41.56||▲0.1||29.08||47.45||D W|
|Exxon Mobil||XOM||82.22||▲0.6||64.65||87.36||D W|
|Kinder Morgan||KMI||19.97||▼-0.6||14.62||20.44||D W|
|Williams Co||WMB||28.47||▼-0.7||20.36||32.22||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||102.08||▼-1.8||82.04||133.53||D W|
|Occidental Petro||OXY||61.84||▼-0.3||56.83||87.67||D W|
|Anadarko Petro||APC||71.77||▲0.5||40.40||76.70||D W|
|Pioneer Natural Res||PXD||168.01||▼-2.5||119.08||213.40||D W|
|Baker Hughes||BHGE||25.57||▼-0.2||20.09||37.76||D W|
|Ntl-Oilwell Varco||NOV||26.44||▼-0.2||24.27||49.08||D W|
|Marathon Petro||MPC||60.65||▲2.0||54.29||88.45||D W|
|Phillips 66||PSX||95.22||▲1.0||78.44||123.97||D W|
|Valero Energy||VLO||90.83||▲3.5||68.81||126.98||D W|
Anadarko Petroleum (APC): Downgraded from Buy to Hold at Jefferies, from Buy to Hold at Johnson Rice and from Sector Outperform to Sector Perform at Scotiabank.
Enbridge (ENB.TO): Downgraded from Outperform to Neutral at Credit Suisse.
Gibson Energy (GEI.TO): Downgraded from Outperform to Neutral at Credit Suisse.
UPDATED: DAILY (END-OF-DAY)
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