Energy stocks drag to the downside on Wednesday
Today's energy market action:
- According to the Energy Information Administration (EIA), US crude stockpiles unexpectedly rose over 7 million barrels last week, mostly due to a major build in the Gulf Coast. Total US output was also estimated to have risen to a new record high of 12.2 million bbl/day, despite a recent decline in active oil rig counts.
- Oil prices were relatively muted on Wednesday, ending the day little changed.
- Gasoline was the only notable mover in energy markets, rising over 1%.
Today's treasury and equity market action:
- Longer duration bond yields moved higher on Wednesday, particularly in the UK, where lawmakers agreed to extend the Brexit deadline. The US 10-year also moved back above 2.5%.
- Global equity markets were in a generally positive mood, on news the US and Chine might be moving closer to a trade deal. The NYSE and TSX both gained a modest 0.1%.
- The S&P 500 index rose 0.2%, with technology, discretionary and materials stocks outperforming broader markets.
- Energy was the worst performing sector on both sides of the border, declining 1% on the SPX and 1.3% on the TSX.
Today's notable energy news:
- White House economic advisor Larry Kudlow says the Trump Administration plans to issue an executive order in the near future, aimed at expediting the construction of natural gas pipelines and new LNG export facilities. The move is in response to pushback from several states, particularly New York, where state-level permits for pipeline construction are repeatedly denied on environmental grounds.
- At its Investor Day meeting in Toronto this morning, Parkland Fuel says it plans to spend $200 million in growth capital this year. The company also confirmed plans for an 8-week turnaround at its Burnaby refinery next year, at an expected cost of about $85 million.
- Natural gas spot prices at the Waha hub in the West Texas Permian basin fell to negative US$3.38/MMBtu on Wednesday, breaking its previous low of almost negative US$2, which coincided with an outage on Kinder Morgan's El Paso pipeline. Service on El Paso has since been mostly restored, with the final compressor station expected to be placed back into service later this week.
- Enbridge began full service on its Texas Eastern Appalachian Lease (TEAL) natural gas pipeline expansion in Ohio. The 7 km line will deliver almost 1 Bcf/day of natural gas from the Marcellus and Utica shale basins into the new Nexus pipeline.
- Total announced plans to take a US$500 million equity stake in the US$30 billion Driftwood LNG project from owner Tellurian, along with a deal to purchase 2.5 million t/y of LNG. The French oil major also agreed to buy 20 million Tellurian shares, at an estimated cost of US$200 million. The US$30 billion Driftwood LNG terminal is located near Lake Charles, Louisiana, with a planned initial capacity of 16.6 million t/y. Tellurian is expected to make a final investment decision sometime in the next few months, with an anticipated in-service date of 2023.
- Still in the LNG space, Total also signed a 10-year supply deal with Guanghui Energy for delivery of 700,000 t/y of LNG into a regasification terminal in China's Jiangsu Province. The gas will be sourced from Total’s global LNG portfolio.
- According to the Columbian government, ExxonMobil and state-run Ecopetrol have each signed agreements with Spain's Repsol for oil exploration offshore Columbia.
|Suncor Energy||SU||43.52||▼-1.0||35.53||55.47||D W|
|Imperial Oil||IMO||36.20||▼-1.1||33.43||44.91||D W|
|Husky Energy||HSE||13.41||▼-0.2||13.24||22.99||D W|
|Pembina Pipeline||PPL||49.74||▼-0.8||37.60||50.45||D W|
|Inter Pipeline||IPL||22.04||▼-0.2||18.60||25.66||D W|
|Gibson Energy||GEI||23.70||▲1.2||15.90||23.75||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||37.01||▼-0.4||30.11||49.08||D W|
|Cenovus Energy||CVE||11.95||▼-1.7||8.74||14.84||D W|
|Vermilion Energy||VET||32.93||▼-0.5||26.67||49.67||D W|
|Pason Systems||PSI||19.97||▼-1.7||16.79||24.57||D W|
|Mullen Group||MTL||12.08||▼-1.1||11.26||16.93||D W|
|Secure Energy||SES||8.35||▼-1.0||6.25||9.44||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||40.80||▼-1.0||27.96||47.45||D W|
|Exxon Mobil||XOM||80.90||▼-0.6||64.65||87.36||D W|
|Kinder Morgan||KMI||19.89||▼-0.8||14.62||20.44||D W|
|Williams Co||WMB||28.91||▼-1.5||20.36||32.22||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||93.93||▼-2.2||82.04||133.53||D W|
|Occidental Petro||OXY||66.06||▼-0.9||56.83||87.67||D W|
|Anadarko Petro||APC||44.47||▼-1.8||40.40||76.70||D W|
|Pioneer Natural Res||PXD||146.06||▼-1.4||119.08||213.40||D W|
|Baker Hughes||BHGE||26.47||▼-1.9||20.09||37.76||D W|
|Ntl-Oilwell Varco||NOV||27.26||▲0.4||24.27||49.08||D W|
|Marathon Petro||MPC||60.38||▲0.8||54.29||88.45||D W|
|Phillips 66||PSX||95.04||▲0.6||78.44||123.97||D W|
|Valero Energy||VLO||84.26||▼-0.2||68.81||126.98||D W|
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