Energy markets take a sharp tumble as US/China trade relations deteriorate
Today’s energy market action:
Equity markets and energy commodities slid lower once again on Thursday, after Chinese officials signalled frustrations over trade talks with the US.
Oil prices suffered their biggest one-day decline so far this year, with both Brent and WTI each shedding over US$3 a barrel. Brent ended the day below US$68, while WTI closed at about US$58.
Canadian Light also declined US$3.50, in line with WTI. The Canadian heavy benchmark shed US$4 a barrel, ending the day at about US$41.50, the lowest since late February. The Canadian heavy discount to WTI widened to over US$16 a barrel on Thursday.
Gasoline and heating oil also lost about 4%.
Today’s equity and currency market action:
Statistics Canada reported a fourth consecutive monthly increase in wholesale sales, rising 1.4% m/m to $64.1 billion in March. The number of Canadians collecting Employment Insurance also dipped 1% m/m in March. Despite the positive news, the loonie declined 0.3%.
Buyers seeking safe-havens fled to the Japanese yen and Swiss franc on Thursday, sending each currency up about 0.6%. The British pound was unchanged despite rumours PM Theresa May may resign her position later this week. The US dollar spiked to a 2-year high earlier in the day, but closed 0.2% lower.
Global bond yields slid lower, particularly in the US, where the short-term yield curve slid into negative territory. German 10-year notes ended the day at -0.12%.
A sea of red in global equity markets on Thursday, including the US and Canada. The NYSE and S&P 500 fell 1.2%, while the TSX declined 1.0%. Energy was the worst performing sector on both sides of the border, falling 3% on the SPX and 4% on the TSX.
Today's notable energy news:
Royal Dutch Shell announced the start of production at its Appomattox FSPO in the US Gulf of Mexico. The facility produces 175,000 boe/day from the Norphlet formation, and is located about 130 km off the coast of Louisiana. Shell says the project was delivered ahead of schedule and "far under" budget. Appomattox is owned jointly with CNOOC.
According to Reuters, BP is nearing an agreement to sell its stake in a major Egyptian oil and gas field to Dubai-based Dragon Oil. The deal is estimated to be worth US$600 million. Dragon Oil a subsidiary of Emirates National Oil Company.
|MEG Energy (MEG -9.9%)|
Kelt Exploration (KEL -8.8%)
Crescent Point (CPG -8.1%)
Nuvista Energy (NVA -7.7%)
Precision Drilling (PD -7.6%)
|Husky Energy (HSE -2.8%)|
CES Energy (CEU -4.3%)
Gran Tierra (GTE -4.3%)
MEG Energy (MEG -9.9%)
Nuvista Energy (NVA -7.7%)
Peyto Exploration (PEY -5%)
Seven Generations (VII -4.9%)
|Suncor Energy||SU||41.37||▼-3.5||35.53||55.47||D W|
|Imperial Oil||IMO||36.49||▼-2.9||33.52||44.91||D W|
|Husky Energy||HSE||12.54||▼-2.8||12.31||22.99||D W|
|Pembina Pipeline||PPL||47.97||▼-1.4||39.15||50.65||D W|
|Inter Pipeline||IPL||20.44||▼-1.5||18.60||25.66||D W|
|Gibson Energy||GEI||22.37||▼-3.8||16.76||23.75||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||34.82||▼-3.3||30.11||49.08||D W|
|Cenovus Energy||CVE||11.10||▼-3.3||8.74||14.84||D W|
|Vermilion Energy||VET||28.88||▼-3.6||26.67||49.67||D W|
|Pason Systems||PSI||19.13||▼-2.7||17.18||24.57||D W|
|Mullen Group||MTL||10.11||▼-0.5||9.39||16.93||D W|
|Secure Energy||SES||7.16||▼-1.7||6.25||9.44||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||39.76||▼-2.9||30.01||47.45||D W|
|Exxon Mobil||XOM||73.79||▼-2.3||64.65||87.36||D W|
|Kinder Morgan||KMI||19.96||▼-1.9||14.62||20.57||D W|
|Williams Co||WMB||27.01||▼-2.2||20.36||32.22||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||88.85||▼-4.4||82.04||133.53||D W|
|Occidental Petro||OXY||52.91||▲0.3||51.29||87.67||D W|
|Anadarko Petro||APC||72.29||▼0.0||40.40||76.70||D W|
|Pioneer Natural Res||PXD||145.58||▼-4.9||119.08||201.63||D W|
|Baker Hughes||BHGE||23.06||▼-1.3||20.09||36.53||D W|
|Ntl-Oilwell Varco||NOV||22.11||▼-4.4||21.67||49.08||D W|
|Marathon Petro||MPC||50.14||▼-3.4||49.71||88.45||D W|
|Phillips 66||PSX||82.27||▼-3.9||78.44||123.97||D W|
|Valero Energy||VLO||75.41||▼-6.2||68.81||126.98||D W|
Bonanza Creek Energy (BCEI): Upgraded from Equal Weight to Overweight at Capital One.
Berry Petroleum (BRY): Upgraded from Equal Weight to Overweight at Capital One.
Callon Petroleum (CPE): Upgraded from Equal Weight to Overweight at Capital One.
Cimarex Energy (XEC): Upgraded from Equal Weight to Overweight at Capital One.
Comstock Resources (CRK): Upgraded from Underweight to Equal Weight at Capital One.
Laredo Petroleum (LPI): Upgraded from Underweight to Equal Weight at Capital One.
Marathon Oil (MRO): Upgraded from Equal Weight to Overweight at Capital One.
Noble Energy (NBL): Upgraded from Equal Weight to Overweight at Capital One.
Penn Virginia (PVAC): Upgraded from Equal Weight to Overweight at Capital One.
SM Energy (SM): Upgraded from Equal Weight to Overweight at Capital One.
W&T Offshore (WTI): Upgraded from Underweight to Equal Weight at Capital One.
Sasol (SSL): Downgraded from Overweight to Neutral at JPMorgan Chase and from Buy to Neutral at Citigroup.
UPDATED: DAILY (END-OF-DAY)
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