Crude Climbs But Omicron Fears Continue
SECTOR COMMENTARY:
Stocks rose with U.S. equity futures Tuesday, signaling a rebound after Monday’s slump, as investors bet that vaccines can help tame the omicron virus outbreak. Treasuries fell.
Oil rose as traders assessed the outlook for demand amid the rapid spread of omicron.
Brent climbed above $72 a barrel in a volatile trading session on Tuesday, having fallen about 5% over the past two days. The new virus variant accounted for 73% of all Covid-19 infections in the U.S. last week, but city traffic in Europe held up over that same period, pointing to a limited demand impact so far. The oil market got a boost from expectations that there would be a major switch in power consumption toward crude and petroleum products earlier in the year, and natural gas prices in Europe were above $300 a barrel of oil equivalent on Tuesday.
Natural gas prices are higher on colder weather and as European gas prices hit a new record high on Tuesday after a pipeline that brings Russian gas to Germany switched to flow east.
BY SECTOR:
US INTEGRATEDS
No significant news.
INTERNATIONAL INTEGRATEDS
Brazil's hydrocarbons regulator ANP has recommended that the country's competition watchdog Cade block the sale of gas company Gaspetro to Compass, a unit of energy company Cosan, newspaper Valor Econômico reported on Monday. According to the report, the ANP recommended that Petrobras, which owns Gaspetro, allow bidders to give individual bids for each state-level concession that forms the natural gas distributor in order to improve the competitive process.
Repsol signed a strategic collaboration with Amazon Web Services (AWS) through which both companies will cooperate to achieve their respective sustainability goals. AWS will provide Repsol with new cloud services to further advance its digital transformation, and Repsol will supply renewable energy to power Amazon business operations.
Royal Dutch Shell signs gas concession agreement for Block 10 in Oman’s Saih Rawl field. The concession agreement establishes Shell as the operator of block 10, holding a 53.45% working interest, with OQ and Marsa Liquefied Natural Gas LLC holding 13.36% and 33.19% respectively. In addition, Shell and Energy Development Oman (EDO) signed an agreement to process the natural gas from Block 10 in EDO's Saih Rawl facility. Shell and the government have agreed that, in parallel to the development of Block 10, Shell will develop options for a separate downstream gas project in which Shell could produce and sell low-carbon products and support the development of hydrogen in Oman.
TotalEnergies launched the largest battery-based energy storage facility in France. Located at the Flandres center in Dunkirk, this site, which responds to the need for grid stabilization, has a power capacity of 61 MW and a total storage capacity of 61 megawatt hours (MWh). It is made up of 27 containers of 2.5 MWh, designed and assembled by Saft, TotalEnergies’ battery affiliate which notably develops advanced batteries for industry.
TotalEnergies signed with the Ministry of Energy and Minerals of the Sultanate of Oman a series of agreements for the sustainable development of the country's natural gas resources.
CANADIAN INTEGRATEDS
No significant news.
U.S. E&PS
Callon Petroleum announced the appointment of Mary Shafer-Malicki to its Board of Directors.
Chesapeake Energy is the first company to certify Haynesville natural gas operations jointly under the MiQ methane standard, and the EO100TM Standard for Responsible Energy Development, which covers a broad range of environmental, social and governance (ESG) criteria. The certification includes Chesapeake's legacy Haynesville Shale operations with production volume of approximately 1 billion cubic feet of natural gas (bcf) per day.
Kosmos Energy filed a Form 8-K with the U.S. Securities and Exchange Commission concerning the decision by Ms. Lisa A. Davis not to stand for re-election to the Board of Directors at the conclusion of her current term which expires at the Company's 2022 Annual Shareholders Meeting. Ms. Davis' decision is not due to any disagreement with the Company's operations, policies or practices.
Talos Energy announced the successful completion of its semi-annual reserves-based loan redetermination process. The Company added an additional lender to the RBL facility and increased commitments from one other, adding a total of approximately $62 million of new commitments. Additionally, Talos added key provisions to increase flexibility for early-stage, pre-FID investments in carbon capture and sequestration business opportunities.
CANADIAN E&PS
No significant news.
OILFIELD SERVICES
No significant news.
DRILLERS
Piper Sandler upgraded Patterson-UTI Energy to Overweight from Neutral.
REFINERS
No significant news.
MLPS & PIPELINES
No significant news.
MARKET COMMENTARY
Wall Street futures rose, in line with global shares, as investors weighed up the extent to which the Omicron coronavirus variant would hit economies around the world. The dollar softened, while gold prices were up. Oil prices rose on increased risk appetite, although gains were capped by pandemic related fears. Current account deficit data is on the economic radar.
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.