Markets suffer another meltdown, as Trump shifts focus back to Mexico

Markets suffer another meltdown, as Trump shifts focus back to Mexico

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Today's energy market action:

  • Traders headed for the exit on Friday, dumping stocks and commodities as US President Donald Trump turned his attention back to Mexico, its third-largest trading partner.

  • Brent slid 3.6%, while WTI ended the day down 5.5%. Canadian Light and C5+ also fell about 6%.

  • WCS lost a more modest 4%, as its differential to WTI narrowed by US$1.45 to about US$15/bbl.

  • For the week, Brent posted a 6% loss, WTI shed almost 9% and Canadian benchmarks all lost about 10%. For the month of May, Brent declined 11% while WTI lost just over 16%, the worst showing since last November. Canadian crude benchmarks declined over 20% this month.

Today's Canadian economic news:

  • After the US reported a Q1 GDP of 3.1% yesterday, Statistics Canada reported a first quarter growth rate of 0.4%, helped by higher household spending and business investment.

  • After six consecutive months of declines, mining and energy activity rose 2.0% in March. Oil and gas extraction activity expanded 3.3%, while support services contracted almost 4% due to lower rigging and drilling activity.

  • Prices for products manufactured in Canada rose 0.8% in April, driven mainly by a 9.2% increase in gasoline prices. Ex-energy, prices are up 0.3% for the month.

  • Prices for raw materials purchased by Canadian manufacturers rose 5.6%, primarily due to a 9.5% increase in crude prices. Ex-energy, raw materials prices are up 2.4% y/y.

  • The loonie dipped lower on Friday, ending the week back below 74 cents.

Today's currency, treasury and equity market update:

  • President Trump shifted focus from China to Mexico today, threatening to hit the country with a 5% tariff on all imports into the US. US refiners import about 700,000 bbl/day of crude from Mexico, but also export about 1 million bbl/day of gasoline. The levies could take effect on June 10, potentially rising to 25% in October. A fresh batch of tariffs on US$60 billion of US imports into China also take effect this weekend.

  • The US dollar shed 0.4% on Friday, giving back most of this week's gains. The Japanese yen was today's big winner in currency markets, as buyers dumped riskier assets in search of safety.

  • Global bond yields tumbled sharply on Friday, continuing this week's general downtrend. The short-term US yield curve fell to -0.21%, returning to levels last seen in the spring of 2007. The US 10-year fell to 2.14%, down more than one full percentage point since late last year. The German 10-year also dipped lower, ending the week at -0.21%.

  • Global equity markets mostly moved lower on Friday. The NYSE fell 1% while the S&P 500 declined 1.3%. This is the fourth consecutive week of losses for the S&P 500, falling 2.6% w/w.

  • The TSX performed comparatively better, falling 0.3% for the day and 1.2% for the week.

  • Energy was one of the worst performing sectors again on Friday. The S&P 500 energy basket fell 1.6% for the day and 4.5% for the week, its eighth consecutive weekly loss. TSX energy declined 1.1% for the day, paring this week's losses to 0.9%.

Today's notable Alberta energy news:

  • Canadian Natural Resources says it evacuated all workers from its Pelican Lake and Woodenhouse facilities, due wildfires in the Wabasca and Slave Lake region of Alberta. The company says it has temporarily shut-in 65,000 bbl/day of crude production.

  • The province of Alberta has set a July oil production quota of 3.71 million bbl/day, unchanged from June's levels. The move is likely in response to a recent widening of the heavy oil discount, which has helped alleviate complaints from crude-by-rail exporters. The energy minister has yet to provide clarity on quotas through the second half of the year. The previous NDP government had committed to keeping the curtailment program in place until the end of 2019.

  • As promised, Alberta's newly elected UCP government officially repealed the federal carbon tax yesterday, much to the dismay of the Trudeau Liberals. Premier Kenney has already asked his attorney general to prepare a constitutional challenge through Alberta courts.

Today's other notable energy news:

  • After declining for three weeks in a row, Baker Hughes says 3 new oil rigs were put into service this week in the US, bringing the total to 800. Canada also added 6 oil rigs, bringing the total to 44.

  • Sempra Energy says it shipped its first commissioning cargo out of Phase 1 of its Cameron LNG facility in Louisiana. The facility includes three trains with a capacity of 12 million t/y, and is expected to receive FERC clearance to begin commercial exports this summer. The project already has approvals for two more trains of expansion. Cameron LNG is owned jointly by Total and three Japanese firms.

  • Magellan Midstream Partners and Navigator Energy Services extended open season on its Voyager Pipeline, which will transport 400,000 bbl/day of crude from Cushing, Oklahoma and Midland, Texas to Houston. The company says it is evaluating other connections within Cushing and additional storage capacity to accommodate demand for other grades of crude.

  • ExxonMobil says its senior managers and engineers will return to Iraq's West Qurna 1 oil field this weekend, after the government agreed to provide additional security. Exxon evacuated about 60 foreign staff members two weeks ago due to undisclosed threats from neighbouring Iran.

  • Marathon Oil closed on the sale of its 15% stake in the Atrush Block in Kurdistan, officially marking its exit from Iraq.

OIL PRICES - DAILY % CHANGE
WTI DIFFERENTIALS
STREAM CLOSE %CHG L 52WK H
BRENT$64.49▼3.650.47
 
86.29
WTI$53.50▼5.542.53
 
76.41
CDN LT$46.00▼6.320.83
 
69.32
C5+$47.50▼6.137.04
 
71.40
WCS$38.35▼4.112.59
 
56.30

CRUDE OIL FUTURES CURVES
BRENT
WTI
█ MAY 31   █ MAY 24   █ MAY 17   █ MAY 10   (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
Parkland Fuel (PKI +1.1%)
TC Energy (TRP +0.9%)
Precision Drilling (PD +0.8%)
Secure Energy (SES +0.6%)
Mullen Group (MTL +0.5%)
12-MO
HIGHS
None
TSX BEARISH INDICATORS
BOTTOM
5
Encana (ECA -4.4%)
Seven Generations (VII -4.2%)
Baytex Energy (BTE -4.1%)
ARC Resources (ARX -3.9%)
Peyto Exploration (PEY -3.9%)
12-MO
LOWS
ARC Resources (ARX -3.9%)
CES Energy (CEU -3.1%)
Nuvista Energy (NVA -2.3%)
Peyto Exploration (PEY -3.9%)
Seven Generations (VII -4.2%)
COMPANY TICKER CLOSE %CHG L 52WK H CHART
INTEGRATED
Suncor EnergySU41.65▼-0.635.53
 
55.47D   W
Imperial OilIMO36.13▼-0.933.52
 
44.91D   W
Husky EnergyHSE12.69▼-0.612.31
 
22.99D   W
MIDSTREAM
EnbridgeENB49.76▲0.339.40
 
51.22D   W
TC EnergyTRP65.89▲0.947.90
 
66.93D   W
Pembina PipelinePPL48.22▼0.039.15
 
50.65D   W
Inter PipelineIPL20.60▼-1.318.60
 
25.66D   W
Keyera KEY32.56▲0.224.05
 
38.91D   W
Gibson EnergyGEI22.06▼-0.616.90
 
23.75D   W
LARGE CAP E&P
Cdn Natural ResCNQ36.51▼-0.130.11
 
49.08D   W
Cenovus EnergyCVE11.08▼-1.68.74
 
14.84D   W
EncanaECA7.13▼-4.46.90
 
18.54D   W
TourmalineTOU17.20▼-1.015.84
 
26.11D   W
Vermilion EnergyVET28.34▼-1.526.67
 
49.67D   W
SERVICES
Pason SystemsPSI19.32▲0.317.18
 
24.57D   W
EnerflexEFX16.37▼-0.513.55
 
20.38D   W
Mullen Group MTL9.75▲0.59.39
 
16.93D   W
ShawcorSCL17.33▼-1.015.11
 
28.89D   W
Secure EnergySES6.99▲0.66.25
 
9.44D   W
REFINING & MARKETING
Parkland FuelPKI41.50▲1.131.15
 
47.45D   W
S&P 500 ENERGY STOCKS
SPX BULLISH INDICATORS
TOP 5
Baker Hughes (BHGE +1.1%)
ConocoPhillips (COP +0%)
12-MO
HIGHS
None
SPX BEARISH INDICATORS
BOTTOM
5
Occidental Petro (OXY -4.1%)
HollyFrontier (HFC -4.1%)
Halliburton (HAL -4%)
Marathon Oil (MRO -3.5%)
Valero Energy (VLO -3.4%)
12-MO
LOWS
EOG Resources (EOG -2.5%)
Occidental Petro (OXY -4.1%)
Schlumberger (SLB -1.4%)
Halliburton (HAL -4%)
Ntl-Oilwell Varco (NOV -1%)
Marathon Petro (MPC -2.4%)
HollyFrontier (HFC -4.1%)
COMPANY TICKER CLOSE %CHG L 52WK H CHART
INTEGRATED
Exxon MobilXOM70.77▼-1.764.65
 
87.36D   W
ChevronCVX113.85▼-1.3100.22
 
128.55D   W
MIDSTREAM
Kinder MorganKMI19.95▼-0.614.62
 
20.57D   W
Williams CoWMB26.38▼-0.920.36
 
32.22D   W
ONEOKOKE63.62▼-0.750.26
 
71.99D   W
LARGE CAP E&P
ConocoPhillipsCOP58.96▲0.056.75
 
80.24D   W
EOG ResourcesEOG81.88▼-2.581.83
 
133.53D   W
Occidental PetroOXY49.77▼-4.149.69
 
87.67D   W
Anadarko PetroAPC70.37▼-0.840.40
 
76.70D   W
Pioneer Natural ResPXD141.96▼-1.7119.08
 
198.61D   W
SERVICES
SchlumbergerSLB34.69▼-1.434.46
 
70.47D   W
HalliburtonHAL21.29▼-4.021.14
 
50.45D   W
Baker HughesBHGE21.41▲1.120.09
 
35.68D   W
Ntl-Oilwell VarcoNOV20.85▼-1.020.38
 
49.08D   W
TechnipFMCFTI20.80▼-3.018.20
 
33.60D   W
REFINERS
Marathon PetroMPC45.99▼-2.445.47
 
88.45D   W
Phillips 66PSX80.80▼-1.578.44
 
123.97D   W
Valero EnergyVLO70.40▼-3.468.81
 
126.98D   W
HollyFrontierHFC37.98▼-4.137.73
 
83.28D   W
NYSE ADRs
COMPANY TICKER CLOSE %CHG L 52WK H CHART
Royal Dutch ShellRDS.A61.81▼-0.855.04
 
71.85D   W
TotalTOT51.50▼-0.949.70
 
65.69D   W
BPBP40.72▼-0.836.28
 
47.57D   W
EniE29.97▼-1.429.75
 
39.16D   W
EquinorEQNR19.15▼-0.218.91
 
28.93D   W
ANALYST RATINGS

UPGRADES

  • Equinor (EQNR): Upgraded from Hold to Buy at HSBC.

DOWNGRADES

  • None.

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
Enbridge meltdown sinks TSX and Canadian energy sector

Enbridge meltdown sinks TSX and Canadian energy sector

Oil prices take a sharp tumble, wiping out two months of gains

Oil prices take a sharp tumble, wiping out two months of gains