Oil prices continue to rally, as markets recover losses from Monday's meltdown

Oil prices continue to rally, as markets recover losses from Monday's meltdown

Today's energy market action:

  • Despite another increase in US crude inventories, oil prices creeped higher again on Wednesday. Brent gained 0.7% while WTI rose 0.4%.

  • Canadian benchmarks rose in tandem with the US benchmark. Differentials on Canadian crude widened slightly, ending the day at US$5.63 for Canadian Light and almost US$13 a barrel for WCS, the highest since mid-February.

  • Wholesale gasoline prices rose almost 2%, ending the day back above US$2 a gallon. Heating oil also rose 1.3%, while Henry Hub natural gas prices sank over 2% for the day.

Today's treasury, currency and equity market action:

  • Higher gas prices helped boost Canada’s annual inflation rate from 1.9% in March to 2.0% in April. Gas prices are up 10% m/m, due in part to new carbon levies introduced in six provinces. Natural gas prices are also up over 10% from the same time last year.

  • In currency markets, the British pound sank to a 3-month low on news of yet another Brexit vote in June. The Aussie dollar continues to sink, headed back to the lows of early 2016. The US dollar was little changed. The loonie gained just over 0.1% for the day.

  • Bond yields all moved lower on Wednesday, including the German 10-year, which fell to -0.10%, the lowest since fall 2016.

  • US markets rallied again on Wednesday, recovering all losses from Monday's mini-meltdown. The NASDAQ was today's big winner, rising over 1%. The NYSE rose 0.3%, while the broader S&P 500 index rose 0.6%. The TSX gained 0.2%.

  • The SPX energy basket gained 0.5%, while TSX energy was roughly unchanged. All subsectors posted gains for the day, except for E&Ps, which were little moved on Wednesday.

Today's supply/demand update:

  • According to the Energy Information Administration (EIA), US crude stockpiles rose by 5.4 million barrels last week, including a 1.8 million barrel increase at the Cushing storage hub in Oklahoma. Total crude output slid to 12.1 million bbl/day, down from a record 12.3 million bbl/day at the beginning of the month.

  • The International Energy Agency (IEA) tweaked its world oil demand to 100.4 million bbl/day for 2019. Global oil supply declined to 99.3 million bbl/day in April, down 300,000 bbl/day from the previous month, due to cutbacks from Canada, Iran, Kazakhstan and Azerbaijan. Libya, Nigeria and Iraq added to OPEC's production last month, bringing the cartel's estimated output to 30.2 million bbl/day. The IEA says rising US production is more than enough to offset further declines expected from Venezuela and Iran.

  • According to Reuters, Venezuela has stopped upgrading extra-heavy Orinoco crude due to a lack of buyers. US sanctions have left the country unable to export its crude, forcing barrels into storage tanks, which have now become full. According to state-owned PDVSA, the upgraders have been placed into recirculation mode. PDVSA operates four upgraders in Venezuela, three owned jointly with Chevron, Total, Equinor and Rosneft.

Today's other notable energy news:

  • Woodfibre LNG announced the purchase of privately-held Canbriam Energy, an E&P firm focused in BC's Montney region. A final investment decision on the LNG terminal is expected by this summer, with start-up currently planned for 2023. The terminal is located in Squamish, BC, and already has approvals in place to export 2.1 million t/y or 40 years. Woodfibre LNG is a subsidiary of Pacific Oil and Gas, which is owned by Singapore's RGE Group.

  • Warren Buffett's Berkshire Hathaway cut its stake in Phillips 66 to 5.6 million shares at the end of the first quarter, about half the previous quarter. Billionaire Seymour Schulich also announced the purchase of more Pengrowth Energy shares, bringing his total stake to 165 million shares, representing approximately 30% of the company's public float.

Today's notable first quarter earnings:

  • Birchcliff Energy posted a $16.9 million profit for the first quarter, up 2% y/y. Revenues rose 12% to $178 million. Quarterly production averaged 74,884 boe/day, down 2% y/y. Full year guidance was left unchanged at 77,000 boe/day.

  • Bellatrix Exploration posted a $19 million loss for the first quarter, up from a $13 million loss for the same quarter last year. Revenues rose 3% to $68.5 million. Production averaged 36,991 boe/day, while 2019 guidance was left unchanged at 34,000 to 36,000 boe/day.

OIL PRICES - DAILY % CHANGE
WTI DIFFERENTIALS
STREAM CLOSE %CHG L 52WK H
BRENT$71.77▲0.750.47
 
86.29
WTI$62.02▲0.442.53
 
76.41
CDN LT$56.40▲0.420.83
 
69.32
C5+$57.77▲0.437.04
 
71.40
WCS$49.07▲0.312.59
 
56.30

CRUDE OIL FUTURES CURVES
BRENT
WTI
█ MAY 15   █ MAY 8   █ MAY 1   █ APR 24   (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
Keyera (KEY +5.1%)
Ensign Energy Svcs (ESI +4.7%)
ARC Resources (ARX +3.5%)
Husky Energy (HSE +1.9%)
CES Energy (CEU +1.7%)
12-MO
HIGHS
TransCanada (TRP +0.4%)
TSX BEARISH INDICATORS
BOTTOM
5
Cenovus Energy (CVE -1.7%)
TORC O&G (TOG -1.5%)
MEG Energy (MEG -1.1%)
Secure Energy (SES -1.1%)
Freehold Royalties (FRU -0.8%)
12-MO
LOWS
Seven Generations (VII +0.5%)
COMPANY TICKER CLOSE %CHG L 52WK H CHART
INTEGRATED
Suncor EnergySU43.15▲0.435.53
 
55.47D   W
Imperial OilIMO37.82▲0.133.52
 
44.91D   W
Husky EnergyHSE13.55▲1.913.10
 
22.99D   W
MIDSTREAM
EnbridgeENB49.30▲0.439.40
 
51.20D   W
TransCanadaTRP64.17▲0.447.90
 
64.57D   W
Pembina PipelinePPL48.09▲0.839.15
 
50.65D   W
Inter PipelineIPL20.69▲0.118.60
 
25.66D   W
Keyera KEY33.22▲5.124.05
 
38.91D   W
Gibson EnergyGEI22.51▲0.516.64
 
23.75D   W
LARGE CAP E&P
Cdn Natural ResCNQ37.32▼-0.530.11
 
49.08D   W
Cenovus EnergyCVE11.86▼-1.78.74
 
14.84D   W
EncanaECA9.03▲0.36.90
 
18.54D   W
TourmalineTOU19.72▲0.215.84
 
26.19D   W
Vermilion EnergyVET31.36▼-0.226.67
 
49.67D   W
SERVICES
Pason SystemsPSI19.74▲0.217.18
 
24.57D   W
EnerflexEFX17.32▲1.313.55
 
20.38D   W
Mullen Group MTL10.17▲1.39.39
 
16.93D   W
ShawcorSCL19.13▼-0.415.11
 
28.89D   W
Secure EnergySES7.47▼-1.16.25
 
9.44D   W
REFINING & MARKETING
Parkland FuelPKI39.77▼-0.330.01
 
47.45D   W
S&P 500 ENERGY STOCKS
SPX BULLISH INDICATORS
TOP 5
Baker Hughes (BHGE +2.1%)
Ntl-Oilwell Varco (NOV +1.4%)
Hess Corp (HES +1.3%)
Concho Res (CXO +1.2%)
Kinder Morgan (KMI +1.1%)
12-MO
HIGHS
None
SPX BEARISH INDICATORS
BOTTOM
5
Helmerich & Payne (HP -1.5%)
Occidental Petro (OXY -0.6%)
ConocoPhillips (COP -0.5%)
Marathon Oil (MRO -0.2%)
Anadarko Petro (APC -0.1%)
12-MO
LOWS
Occidental Petro (OXY -0.6%)
Marathon Petro (MPC +0.8%)
COMPANY TICKER CLOSE %CHG L 52WK H CHART
INTEGRATED
Exxon MobilXOM76.37▲0.764.65
 
87.36D   W
ChevronCVX122.14▲0.4100.22
 
130.39D   W
MIDSTREAM
Kinder MorganKMI20.14▲1.114.62
 
20.44D   W
Williams CoWMB27.71▲0.820.36
 
32.22D   W
ONEOKOKE67.25▲0.450.26
 
71.99D   W
LARGE CAP E&P
ConocoPhillipsCOP62.04▼-0.556.75
 
80.24D   W
EOG ResourcesEOG94.36▲0.082.04
 
133.53D   W
Occidental PetroOXY54.25▼-0.653.12
 
87.67D   W
Anadarko PetroAPC72.87▼-0.140.40
 
76.70D   W
Pioneer Natural ResPXD151.49▲0.8119.08
 
213.40D   W
SERVICES
SchlumbergerSLB39.33▲0.934.99
 
75.43D   W
HalliburtonHAL25.59▲0.624.33
 
54.91D   W
Baker HughesBHGE22.74▲2.120.09
 
37.41D   W
Ntl-Oilwell VarcoNOV24.71▲1.423.42
 
49.08D   W
TechnipFMCFTI22.80▲0.818.20
 
34.39D   W
REFINERS
Marathon PetroMPC51.19▲0.850.19
 
88.45D   W
Phillips 66PSX87.30▲0.478.44
 
123.97D   W
Valero EnergyVLO83.37▲0.568.81
 
126.98D   W
HollyFrontierHFC43.71▲0.242.19
 
83.28D   W
NYSE ADRs
COMPANY TICKER CLOSE %CHG L 52WK H CHART
Royal Dutch ShellRDS.A64.86▲1.255.04
 
73.86D   W
TotalTOT53.45▲0.949.70
 
65.69D   W
BPBP41.77▲0.536.28
 
47.83D   W
EniE32.47▼-0.129.75
 
40.12D   W
EquinorEQNR21.02▼-0.119.95
 
28.93D   W
ANALYST RATINGS

UPGRADES

  • Hess (HES): Upgraded from Underweight to Equal Weight at Capital One.

  • PBF Energy (PBF): Upgraded from Neutral to Outperform at Credit Suisse.

DOWNGRADES

  • Buckeye Partners (BPL): Downgraded from Buy to Neutral at UBS.

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
Oil prices and equity markets post third consecutive day of gains

Oil prices and equity markets post third consecutive day of gains

Markets breathe a sigh of relief, sending oil prices and energy stocks higher

Markets breathe a sigh of relief, sending oil prices and energy stocks higher