Oil prices break to the upside as OPEC production slides
Crude oil benchmarks all posted nice gains this week, particularly WCS, which rose 6%, and WTI, up 4.4% for the week. Discounts for Canadian light and heavy crude were little changed.
Gasoline prices posted a second week of solid gains, rising over 3% from last Friday's close. Heating oil gave back 1.6% this week.
In natural gas markets, Henry Hub declined 2.4% w/w, while AECO retreated almost 6%.
The EIA boosted its full-year 2019 WTI forecast to US$56.13 a barrel, up 2.4% from its previous forecast. Brent was also boosted almost 3% to US$54.64.
This week's notable Canadian economic news:
- After three consecutive months of declines, manufacturing sales rose 1.0% to $57.1 billion in January.
- Canada's 10-year bond rates declined 4 basis points to 1.72%.
- The Canadian dollar gained 0.5%, ending Friday just below 75 cents.
This week's US economic news:
- CPI rose on an annualized basis of 1.5%, well under the Fed’s target of 2%. Core inflation ticked lower from 2.2% to 2.1%.
- After a big decline in December, retail sales rose 0.2% in January. Sales of motor vehicles and fuel continue to drag to the downside.
- Despite a good showing from the energy sector, industrial production posted a feeble 0.1% increase in February, with manufacturing contracting another 0.4% for the month.
- The US Federal Reserve is expected to keep interest rates unchanged at their upcoming meeting this week. The US dollar declined about 1% this week, mostly due to strength in other foreign currencies.
Across the pond this week:
- UK lawmakers rejected a "hard-Brexit" option, sending PM Theresa May back into negotiations with the EU. The pound had a very good showing this week, rising 2%. The Bank of England is also expected to keep interest rates unchanged at their next Monetary Policy Meeting on Thursday.
- The Bank of Japan also reiterated its commitment to keep interest rates at zero. The Japanese 10-year declined to -0.04%.
Except for Australia, most global exchanges moved higher this week.
In New York, the NYSE rose 2.4%, while the NASDAQ gained 3.8%. Except for industrials, which was hit hard by a steep decline in Boeing stocks, all sectors posted nice gains for the week.
In Toronto, the TSX rose almost 1%, led higher by energy and healthcare stocks.
The TSX energy sector gained 2.8% this week, with producers and midstream stocks posting the best results.
The S&P 500 energy sector rose 3.2%, with producers and refining stocks leading to the upside.
|Suncor Energy||SU||45.02||▲3.0||35.53||55.47||D W|
|Imperial Oil||IMO||36.39||▼-0.4||33.43||44.91||D W|
|Husky Energy||HSE||13.47||▼-3.4||13.33||22.99||D W|
|Pembina Pipeline||PPL||49.35||▲0.7||37.60||50.04||D W|
|Inter Pipeline||IPL||21.91||▲1.1||18.60||25.66||D W|
|Gibson Energy||GEI||22.71||▲2.1||15.79||23.32||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||37.00||▲3.2||30.11||49.08||D W|
|Cenovus Energy||CVE||11.69||▲6.3||8.74||14.84||D W|
|Vermilion Energy||VET||33.22||▼-1.6||26.67||49.67||D W|
|Pason Systems||PSI||20.15||▲0.4||16.61||24.57||D W|
|Mullen Group||MTL||12.32||▲4.2||11.26||16.93||D W|
|Secure Energy||SES||8.27||▲1.5||6.25||9.44||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||39.53||▲3.1||27.96||47.45||D W|
|Exxon Mobil||XOM||80.15||▲1.4||64.65||87.36||D W|
|Kinder Morgan||KMI||19.87||▲0.7||14.62||20.09||D W|
|Williams Co||WMB||27.56||▲2.3||20.36||32.22||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||88.85||▲2.8||82.04||133.53||D W|
|Occidental Petro||OXY||65.47||▲4.4||56.83||87.67||D W|
|Anadarko Petro||APC||44.55||▲5.9||40.40||76.70||D W|
|Pioneer Natural Res||PXD||135.67||▲4.1||119.08||213.40||D W|
|Baker Hughes||BHGE||27.85||▲8.2||20.09||37.76||D W|
|Ntl-Oilwell Varco||NOV||26.48||▲2.4||24.27||49.08||D W|
|Marathon Petro||MPC||60.45||▲5.1||54.29||88.45||D W|
|Phillips 66||PSX||98.52||▲4.5||78.44||123.97||D W|
|Valero Energy||VLO||85.08||▲6.7||68.81||126.98||D W|
- OPEC+ Joint Ministerial Monitoring Meeting in Azerbaijan
- Alberta government delivers throne speech
- Federal government releases 2019/2020 budget
- WPC2019 kicks-off in San Antonio, TX
- API Weekly Statistical Bulletin
- 2019 Federal Budget
- Saskatchewan government releases provincial budget
- FOMC Meeting and Interest Rate Decision
- EIA Weekly Petroleum Status Report
- Last trading day for WTI April contract
- StatsCan Wholesale Trade (Jan 2019 data)
- StatsCan Employment Insurance (Jan 2019 data)
- EIA Weekly Natural Gas Storage Report
- StatsCan Retail Trade (Jan 2019 data)
- StatsCan Consumer Price Index (Feb 2019 data)
- Baker Hughes Weekly Rig Counts.