Oil prices catch a small bounce as equity markets surge higher
Today's energy market action:
After several day of declines, crude benchmarks mostly moved higher on Tuesday, along with US and European equity markets.
Brent rose 1.1% while WTI gained 0.4%. Canadian Light and WCS also rose about 0.5%, while Edmonton Condensate (C5+) moved up 1%, as its discount to WTI narrowed by US$0.25 to US$5.50 a barrel.
According to the American Petroleum Institute, US crude stockpiles are expected to have risen by 3.5 million barrels last week. Official numbers from the Energy Information Administration (EIA) are due to be released Wednesday morning.
Today's currency and equity market action:
In a speech earlier this week, St. Louis Fed president James Bullard hinted an interest rate cut may be back on the table, if global trade continues to show signs of weakening. The US dollar ended the day little changed.
After sliding for much of the past two weeks, US markets surged higher on Tuesday, led by the Dow Jones Industrial Average, which rose over 500 points (+2.1%). The NYSE gained 1.8% while the S&P 500 also rose 2.1%. Most US sectors ended the day higher, including energy, which gained 1.6%.
In Toronto, the TSX rose almost 1%, with all sectors posting gains for the day. The Canadian energy sector rose 0.4% on Tuesday.
Today's global supply update:
Exports of Venezuelan crude and refined products dropped to 874,500 bbl/day in May, down 16% from the previous month. Exports to India were cut by one-third to 187,000 bbl/day, while China purchased around 450,000 bbl/day. Russia's Rosneft remains the largest buyer of Venezuelan crude, as part of its loan repayment program. Despite US sanctions, Spain's Repsol also received several thousand barrels as part of a fuel exchange program.
According to the EIA, US imports of Venezuelan crude dropped from 250,000 bbl/day in February to just 50,000 bbl/day in March. Preliminary figures show zero imports in the middle of May.
Russian output is still struggling to recover from the tainted pipeline scandal. The country averaged 11.11 million bbl/day in May, and is currently tracking closer to 10.9 million bbl/day. The cutbacks are expected to tip the Russian economy into recession this quarter. Rosneft CEO Igor Sechin once again questioned the need to take part in OPEC's production quotas, suggesting he may seek compensation from the Russian government.
Today's other notable energy news:
Equinor and its partners, Suncor Energy and Siccar Point Energy, are expected to make a final investment decision on the massive Rosebank project by next spring. Rosebank is one of the largest undeveloped oil and gas fields in the UK North Sea, with an estimated price tag of more than US$6 billion.
Total is expected to begin production at its Culzean field in the UK North Sea within the next few days, ahead of schedule and under budget. Culzean holds an estimated 300 million barrels of oil equivalent. The facility is expected produce 100,000 boe/day.
The US Federal Trade Commission has cleared Occidental Petroleum's plan to take-over Anadarko Petroleum, allowing the deal to close in the second half of the year, subject to all other conditions.
LNG behemoth Cheniere Energy sanctioned a sixth expansion train at Sabine Pass, and adjusted the plant's capacity to between 4.8 and 4.9 million t/y per train. The company also announced a 15-year supply deal with Apache Corp for 0.85 million t/yr out of its Corpus Christi Stage III LNG facility.
At today's 2019 Management Day meeting, Royal Dutch Shell says it remains on track to meet or exceed its 2020 commitments, which include US$35 billion in free cash flow for 2025, and returning US$125 billion back to shareholders, in the form of dividends and share buybacks.
|Suncor Energy||SU||40.52||▼-0.4||35.53||55.47||D W|
|Imperial Oil||IMO||35.79||▼-0.5||33.52||44.91||D W|
|Husky Energy||HSE||12.96||▲2.5||12.31||22.99||D W|
|TC Energy||TRP||66.15||▲1.2||47.90||66.93||D W|
|Pembina Pipeline||PPL||48.66||▲1.0||39.15||50.65||D W|
|Inter Pipeline||IPL||20.67||▼-0.1||18.60||25.66||D W|
|Gibson Energy||GEI||22.63||▲2.4||16.90||23.75||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||36.01||▲0.7||30.11||49.08||D W|
|Cenovus Energy||CVE||10.75||▼-0.9||8.74||14.84||D W|
|Vermilion Energy||VET||28.82||▲1.3||26.67||49.67||D W|
|Pason Systems||PSI||19.23||▼-0.3||17.18||24.57||D W|
|Mullen Group||MTL||10.00||▲1.0||9.39||16.93||D W|
|Secure Energy||SES||7.04||▲1.4||6.25||9.44||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||42.80||▲2.5||31.16||47.45||D W|
|Exxon Mobil||XOM||73.59||▲2.4||64.65||87.36||D W|
|Kinder Morgan||KMI||20.34||▲1.0||14.62||20.57||D W|
|Williams Co||WMB||27.69||▲3.1||20.36||32.22||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||84.28||▲1.6||81.32||133.53||D W|
|Occidental Petro||OXY||49.69||▲0.8||49.05||87.67||D W|
|Anadarko Petro||APC||70.60||▲0.8||40.40||76.70||D W|
|Pioneer Natural Res||PXD||144.62||▲1.4||119.08||197.42||D W|
|Baker Hughes||BHGE||22.04||▲0.9||20.09||35.68||D W|
|Ntl-Oilwell Varco||NOV||21.32||▲0.5||20.38||49.08||D W|
|Marathon Petro||MPC||48.49||▲2.9||45.47||88.45||D W|
|Phillips 66||PSX||84.12||▲2.3||78.44||123.97||D W|
|Valero Energy||VLO||73.85||▲2.6||68.81||126.98||D W|
Superior Energy Services (SPN): Upgraded from Underweight to Neutral at JPMorgan Chase.
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