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Crude In Focus Ahead of OPEC Meeting


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WEDNESDAY, DECEMBER 05, 2018

SECTOR COMMENTARY

The futures market points to gains following Tuesday's hefty sell-off in stocks which was accompanied by other bearish signals including short-term yields trading above longer-term rates for the first time in more than a decade.  Meanwhile, equity and bond markets are closed today for a national day of mourning in observance of the passing of President George HW Bush although commodities and derivatives will continue to trade.

Oil prices reversed the prior two sessions' gains as Saudi talked down expectations ahead of Thursday's OPEC meeting.  Concerns about global growth and lack of sufficient progress with China on trade deals also weighed on sentiment as did mild strength in the USD.  Additionally, crude inventory data from the EIA will be released tomorrow due to today's national day of mourning.

U.S. natural gas futures rose on Wednesday as the market took a break from weeks of extreme volatility as daily production eases despite forecasts for near normal weather over the next two weeks.

US INTEGRATEDS

(Late Tuesday) Press Release - Chevron announced that Debra Reed-Klages has been elected to Chevron's board of directors. Reed-Klages' appointment is effective immediately and, as of December 5, 2018, she will serve on the Management Compensation Committee and the Public Policy Committee.

(Late Tuesday) Reuters - The gasoline-producing fluidic catalytic cracking unit (FCCU) at Exxon Mobil 's 365,644-barrel-per-day (bpd) Beaumont, Texas, refinery may be shut for two weeks of additional work before the company attempts a second restart.

INTERNATIONAL INTEGRATEDS

Reuters - Petroleo Brasileiro said that the company could raise $26.9 billion through asset sales and partnerships by 2023 as part of a new strategic business plan calling for further debt reduction. Petrobras, as the company is known, said in a securities filing that its ratio of net debt to adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) should fall to below 1.5 in 2020.

Press Release - Total is consolidating its position as key player in electric mobility by launching today an innovative line of fluids for electric and hybrid vehicles. Produced thanks to important efforts of the Group's R&D teams, these products have been specially developed to meet the cooling and lubrication needs of the various components of these new types of engines and to ensure that they remain in peak condition throughout their lifetime. Two new product lines are now available to automakers: Total Quartz EV Fluid, for light vehicles, and Total Rubia EV Fluid, for industrial & utility vehicles and electric buses.

U.S. E&PS

(Late Tuesday) Press Release - Apache announced it has initiated production from its Garten development on Block 9/18a Area-W in the United Kingdom sector of the North Sea. The discovery well, which is located 6 kilometers south of the Beryl Alpha Platform, was placed on production in late November, less than eight months after being drilled in March 2018.

(Late Tuesday) Press Release - Sanchez Energy announced that it has engaged Moelis & Company as financial advisor to explore strategic alternatives to strengthen its balance sheet and maximize the value of the company.

CANADIAN E&PS

Reuters - Canadian Natural Resources forecast 2019 capital budget about C$1 billion ($753 million) lower than last year, blaming a lack of market access for its oil and "dysfunctional" government processes. The company set 2019 capital budget at around C$3.7 billion, compared with C$4.7 billion in 2018, with maintenance capital targeted at about $3.1 billion.

OILFIELD SERVICES

Press Release - Calfrac Well Services announced its 2019 capital program of approximately $149 million which includes $126 million of maintenance capital, $11 million of refurbishment capital and $12 million related to corporate initiatives. In addition, approximately $10 million remaining from Calfrac's 2018 capital program is expected to be spent in 2019.

GMP upgraded Trican Well Service to 'Buy' from 'Hold'.

Press Release - U.S. Silica Holdings said that the part of its Industrial and Specialty Products business focused on silica sand will increase prices for most of its non-contracted silica sand, cool roof granule, aplite and specialty products used primarily in glass, foundry, paints, coatings, elastomers, roofing, chemicals, recreation, building products and other applications. The increases are effective for shipments starting Jan. 1, 2019. Price increases will range from 2 to 9 percent, depending on the product and grade. The price increases are being made to support the continued investments the Company is making in upgrading its capacity to meet the growing demand for its products and to offset rising production costs.

MLPS & PIPELINES

(Late Tuesday) Reuters - Enbridge said its Mainline crude pipeline system is facing temporary outages and reduced flow rates due to a power outage caused by extreme weather in Saskatchewan, Canada. Enbridge said it is working with the SaskPower utility company to restore power and has no timeline for when operations will return to normal.

(Late Tuesday) Press Release - Gibson Energy announced that its Board of Directors has approved a 2019 growth capital expenditure budget in the range of $200 million to $250 million, with nearly all investment directed towards sanctioned growth projects. Additionally, the Board of Directors has approved the allocation of approximately $30 million to $35 million in replacement capital expenditures.

(Late Tuesday) Press Release - Pembina Pipeline announced that its Board of Directors declared a common share cash dividend for December 2018 of $0.19 per share to be paid, subject to applicable law, on January 15, 2019 to shareholders of record on December 31, 2018. This dividend is designated an "eligible dividend" for Canadian income tax purposes. For non-resident shareholders, Pembina's common share dividends should be considered "qualified dividends" and may be subject to Canadian withholding tax.

Press Release - TransCanada announced that it has secured 675,000 gigajoules (GJ) (630 million cubic feet) per day of new natural gas transportation contracts from the Western Canadian Sedimentary Basin (WCSB) on TransCanada's Canadian Mainline. Its North Bay Junction Open Season resulted in long-term, fixed-priced contracts for service that will reach markets in Ontario, Quebec, the Maritimes and the Northeastern U.S.

Nasdaq Advisory Services Energy Team is part of Nasdaq's Advisory Services -- the most experienced team in the industry. The team delivers unmatched shareholder analysis, a comprehensive view of trading and investor activity, and insights into how best to manage investor relations outreach efforts. For questions, please contact Tamar Essner . This communication and the content found by following any link herein are being provided to you by Corporate Solutions, a business of Nasdaq, Inc. and certain of its subsidiaries (collectively, "Nasdaq"), for informational purposes only. Nasdaq makes no representation or warranty with respect to this communication or such content and expressly disclaims any implied warranty under law. Sources include Reuters, TR IBES, WSJ, The Financial Times and proprietary Nasdaq research.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



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