Oil and gas prices retreat, despite mounting outages in the Gulf of Mexico
Today's energy market update:
After yesterday's big run-up, oil prices took a breather on Thursday, pulling back slightly for the day. Brent slipped 0.7% while WTI declined 0.4%. Canadian light and heavy crude also fell 0.4%, as differentials to WTI were little changed.
Heating oil and gasoline also retreated about 0.7%. Despite the onset of hot summer weather and production outages in the Gulf of Mexico, Henry Hub fell 1.5%, wiping out all of yesterday's gains.
Today's currency and equity market action:
Slightly stronger than expected US inflation data sent bond yields higher on Thursday. Despite the move, the US dollar was unchanged for the day. The loonie moved up another 0.1%.
North American markets were mixed on Thursday. The NYSE posted a 0.2% gain, the NASDAQ fell 0.1%, while the TSX declined 0.2%. The S&P 500 rose 0.2%, with most sectors posting gains for the day.
Energy stocks were little changed in Toronto, but up 0.2% on the SPX. Canadian energy services stocks were the worst performing subsector, while US refiners posted the biggest gains.
Today's supply/demand update:
Tropical Storm Barry has now taken over a million bbl/day offline in the Gulf of Mexico (GoM), as the storm intensifies on its way to Louisiana. Phillips 66 shutdown its 253,600 bbl/day Alliance Refinery, located just south of New Orleans, after the region was put under a mandatory evacuation order. As of noon Thursday, 53% of GoM oil production and 45% of natural gas output has been taken offline.
In its latest Monthly Oil Market report, OPEC says its production fell another 68,000 bbl/day last month, to an average of 29.83 million bbl/day. OPEC cut its 2019 non-OPEC oil supply forecast to 64.4 million bbl/day, due to downward revisions for Russia, Brazil and Norway. Non-OPEC growth is expected to rebound to 66.9 million bbl/day next year, due in part to new pipeline construction in North America, and higher production out of Brazil and Norway.
As a result, OPEC now says its 14 members need to produce just 29.3 million bbl/day next year, 500,000 bbl/day less than the current output, and 1.34 million bbl/day less than the 2019 average.
Today's other notable energy news:
Tensions between Iran and the UK flared up again this week after three Iranian vessels tried to stop a BP-operated tanker from travelling through the Strait of Hormuz. The Iranian vessels were promptly scurried away by a British warship. The incident comes one week after the UK seized an Iranian tanker off the coast of Gibraltar for violating sanctions on Syria.
CES Energy Solutions was approved to buy back and cancel up to 18.6 million of its shares over the next 12 months, representing 7.5% of its public float.
Occidental Petroleum boosted its quarterly dividend by US$0.01 to $0.79 per share, a 17th consecutive year of dividend increases. CEO Vicki Hollub says the increase reflects the company's commitment to boost its dividend every year.
|Suncor Energy||SU||42.38||▼-0.1||35.53||55.47||D W|
|Imperial Oil||IMO||37.04||▲0.6||33.52||44.91||D W|
|Husky Energy||HSE||12.68||▲0.3||12.18||22.99||D W|
|TC Energy||TRP||66.81||▲0.3||47.90||67.15||D W|
|Pembina Pipeline||PPL||50.21||▲0.5||39.15||50.65||D W|
|Inter Pipeline||IPL||22.21||▲0.1||18.60||25.66||D W|
|Gibson Energy||GEI||23.82||▼-0.4||16.90||24.18||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||36.04||▼-0.3||30.11||48.73||D W|
|Cenovus Energy||CVE||12.31||▲0.4||8.74||14.44||D W|
|Vermilion Energy||VET||28.35||▼-1.0||26.54||49.67||D W|
|Pason Systems||PSI||18.23||▼-0.6||17.18||24.57||D W|
|Mullen Group||MTL||9.40||▼-1.4||9.36||16.93||D W|
|Secure Energy||SES||7.20||▼-1.8||6.25||9.44||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||43.11||▼-0.5||31.59||47.45||D W|
|Exxon Mobil||XOM||77.57||▲0.1||64.65||87.36||D W|
|Kinder Morgan||KMI||21.27||▲0.5||14.62||21.50||D W|
|Williams Co||WMB||28.71||▼-0.4||20.36||32.22||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||90.84||▲0.2||80.41||133.53||D W|
|Occidental Petro||OXY||50.44||▲0.4||47.00||85.23||D W|
|Anadarko Petro||APC||71.98||▲1.2||40.40||76.23||D W|
|Pioneer Natural Res||PXD||144.86||▼-1.2||119.08||193.03||D W|
|Baker Hughes||BHGE||25.24||▼-0.6||20.09||35.55||D W|
|Ntl-Oilwell Varco||NOV||22.02||▼-0.3||19.57||49.08||D W|
|Marathon Petro||MPC||55.44||▲0.8||45.47||88.45||D W|
|Phillips 66||PSX||99.59||▲1.5||78.44||123.97||D W|
|Valero Energy||VLO||84.43||▲1.2||68.81||122.42||D W|
Bonterra Energy (BNE.TO): Downgraded from Strong Buy to Outperform at Raymond James.
Continental Resources (CLR): Downgraded from Outperform to Market Perform at BMO.
PDC Energy (PDCE): Downgraded from Outperform to Market Perform at BMO.
Cimarex Energy (XEC): Downgraded from Outperform to Market Perform at BMO.
UPDATED: DAILY (END-OF-DAY)
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