Oil prices end Friday on a high note, as Brent finally tops US$70
Today's energy market action:
- Oil prices followed equity markets higher on Friday, with each benchmark posting nice gains for the day.
- Brent rose 1.4%, moving back above US$70 for the first time since last November. WTI rose 1.6% for the day. For the week, Brent and WTI gained 3% and 5%, respectively.
- In Canada, Canadian Light and Western Canadian Select (WCS) both rose 1.8%. For the week, both benchmarks are up about 8%.
- Edmonton Condensate (C5+) also rose 1.7%, ending the day just under US$59 a barrel.
- Gasoline and heating oil prices also rose 1.5% on Friday.
Today's supply/demand update:
- According to Baker Hughes, the US put 15 new oil rigs into service this week, the first increase in 7 weeks.
- Canada lost another 13 rigs, leaving just 22 oil rigs in service. Canadian rig counts are now down by 137 from last February, due in part to the spring thaw. There were almost 50 oil rigs in service for the same time last year. The all-time low for Canadian rig counts was just 8, reached in April 2016.
Today's equity market update:
- Equity markets were in a generally positive mood on Friday, with most global markets ending the day higher.
- In New York, the NYSE and S&P 500 Large Cap index rose 0.5% for the day and about 2% for the week. Energy was the best performing sector on the SPX, rising 1.7% on Friday.
- In Toronto, the TSX rose 0.5% for the day and 1.8% for the week. Energy was also the best performing sector, rising 3% on Friday.
- Producers were the best performing subsector on both sides of the border.
Today's notable energy news:
- Chevron Canada and Australia's Woodside Energy have filed a revised application with the National Energy Board for their proposed Kitimat LNG project. Kitimat LNG currently has a 20-year export license for 10 million t/y. The new application is seeking approval for 21 million t/y of export capacity, for a 40-year term. Chevron says the new design provides for improved "cost of supply competitiveness relative to other global LNG projects." Neither company has provided a cost estimate or estimated date of sanctioning.
- TransCanada is reportedly looking to sell its Columbia Midstream unit, worth an estimated US$1 billion. Columbia Midstream includes a number of gathering systems and pipelines around the Appalachian Basin. TransCanada is also looking to sell a package of mineral rights in the same area. The divestitures are all part of the company's efforts to finance big-ticket growth projects, such as Coastal GasLink and Keystone XL.
- Marathon Petroleum now says it plans to spend US$1.2 billion upgrading its Galveston Bay refinery complex over the next three years, slightly less than previously planned. Once completed, output will be increased by 40,000 bbl/day. Galveston Bay includes the former Texas City refinery, currently the second largest refinery in the US, with a capacity of 585,000 bbl/day.
- According to Bloomberg, Petrobras has reached a deal to sell a 90% stake in its Transportadora Associada de Gas (TAG) division to France's Engie and Quebec's Caisse de dépôt et placement for US$8.6 billion. TAG consists of 4,500 km of natural pipelines throughout northern Brazil. Petrobras has yet to confirm the deal.
- Tokyo Gas signed a 500,000 t/y LNG supply deal with Royal Dutch Shell, with prices indexed to the price of coal. The Japanese utility says the move is intended to enhance diversification of LNG import prices, improving its ability to compete with cheaper coal-fired power.
- Reuters is reporting that the Saudi Kingdom has threatened to diversify away from the US dollar, if US lawmakers follow through with "NOPEC" legislation, which would open the cartel to anti-trust lawsuits. NOPEC does not have much support from the Trump Administration, and is viewed as having a slim chance of being passed into law. Anti-trust regulations prevent deliberate market manipulation for the sole purpose of price-fixing, a major part of OPEC's reason for being.
|Suncor Energy||SU||44.50||▲1.8||35.53||55.47||D W|
|Imperial Oil||IMO||36.57||▲1.2||33.52||44.91||D W|
|Husky Energy||HSE||13.69||▲2.5||13.21||22.99||D W|
|Pembina Pipeline||PPL||50.20||▲1.0||38.60||50.45||D W|
|Inter Pipeline||IPL||21.93||▼-0.2||18.60||25.66||D W|
|Gibson Energy||GEI||23.34||▲0.3||16.15||23.75||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||38.41||▲3.8||30.11||49.08||D W|
|Cenovus Energy||CVE||12.58||▲4.7||8.74||14.84||D W|
|Vermilion Energy||VET||33.80||▲3.1||26.67||49.67||D W|
|Pason Systems||PSI||20.16||▲0.5||17.18||24.57||D W|
|Mullen Group||MTL||12.25||▲1.3||11.26||16.93||D W|
|Secure Energy||SES||8.60||▲2.3||6.25||9.44||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||40.45||▼-0.1||28.07||47.45||D W|
|Exxon Mobil||XOM||82.49||▲0.6||64.65||87.36||D W|
|Kinder Morgan||KMI||20.05||▲0.7||14.62||20.44||D W|
|Williams Co||WMB||29.11||▲1.0||20.36||32.22||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||98.63||▲5.4||82.04||133.53||D W|
|Occidental Petro||OXY||68.04||▲2.4||56.83||87.67||D W|
|Anadarko Petro||APC||47.01||▲4.4||40.40||76.70||D W|
|Pioneer Natural Res||PXD||150.68||▲2.1||119.08||213.40||D W|
|Baker Hughes||BHGE||26.78||▲0.0||20.09||37.76||D W|
|Ntl-Oilwell Varco||NOV||28.20||▲3.0||24.27||49.08||D W|
|Marathon Petro||MPC||63.47||▲3.5||54.29||88.45||D W|
|Phillips 66||PSX||97.79||▲1.0||78.44||123.97||D W|
|Valero Energy||VLO||86.69||▲2.8||68.81||126.98||D W|
Ecopetrol (EC): Upgraded from Underweight to Neutral at JPMorgan.
NextDecade (NEXT): Upgraded from Underperform to Market Perform at Wolfe Research.
UPDATED: DAILY (END-OF-DAY)
• OIL PRICES REFLECT NEAR MONTH CONTRACT FROM THE NYMEX/CME GROUP
• EQUITY PRICES PROVIDED BY NYSE & TMX GROUP
• CHARTPACKS COURTESY STOCKCHARTS.COM (DIVIDEND ADJUSTED)
• 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