Leadership

Crude Falls on Lingering Fears of Slowing Economic Growth

Thursday, March  28, 2019

SECTOR COMMENTARY

Energy stocks are set to open mostly lower, dragged down by weaker broader indices and another 1% + decline in the crude oil pits.  News flow is reaching a low in the sector as the quarter concludes tomorrow and quiet periods ahead of earnings releases ramp up beginning next week.

Crude oil futures are off, with WTI crude prompt-month recently trading at $58.27 and Brent crude oil offering around $66.65 as of 8:45 AM EST.  Emerging and lingering fears of slowing economic growth across the globe, reinforced by sovereign yields reaching lows not seen since late 2017, have weighed on prices recently.  Additionally, President Trump tweeted shortly ago, "Very important that OPEC increase the flow of Oil. World Markets are fragile, price of Oil getting too high. Thank you!"  This is extending oil’s losses.

Natural gas futures are higher ahead of weekly inventory.  Analysts expect a draw of 39 bcf. 

INTERNATIONAL INTEGRATEDS

Reuters - Neptune Energy said it had agreed with partners BP and Japex a final investment decision for the Seagull oil and gas field in the British North Sea.

Press Release - Bourbon Marine & Logistics announced that it has been awarded by SHELL its first integrated logistics contract for the support of its exploration campaign in Black Sea, Bulgaria, in partnership with Bulgarian operator Bon Marine. The project scope covers the full logistics solution project management, offering for the first time both Marine logistics together with shore logistics: marine services, logistics base, warehousing, port facilities, cargo carrying units, waste management, customs clearance, etc.

U.S. E&PS

Press Release - CNX Resources announced the final results and expiration of its previously announced cash tender offer to purchase up to $400.0 million aggregate principal amount of the then-approximately $1,294,307,000 aggregate principal amount outstanding of its 5.875% Senior Notes due 2022. As of 5:00 p.m., New York City time, on March 27, 2019, the Expiration Time for the offer, CNX had received tenders for an aggregate principal amount of $1,149,251,000 of the outstanding Notes.

Press Release - Denbury Resources announced the appointment of Mary M. VanDeWeghe to its Board of Directors on March 27, 2019. Ms. VanDeWeghe has been appointed to the Audit Committee and Reserves and Health, Safety and Environmental Committee of the Board. Also announced, Laura A. Sugg notified the Board that she will not stand for re-election to the Board at the Company’s upcoming annual meeting of stockholders to be held May 22, 2019. Ms. Sugg has been a member of the Board since 2012, currently serving as the Chairperson of the Compensation Committee. 

(Late Wednesday) Press Release - SM Energy announced that its Board of Directors has approved a semi-annual cash dividend of $0.05 per share of common stock outstanding. The dividend will be paid on May 8, 2019, to stockholders of record as of the close of business on April 26, 2019. The Company currently has approximately 112.2 million shares of common stock outstanding.

(Late Wednesday) Press Release - Sundance Energy Australia reported net income attributable to owners of the Company was US $64.7 million for the fourth quarter of 2018 and a loss of US $28.1 million for full year 2018. Total revenue for the quarter increased ~105.7% to US $58.3 million as compared to the same prior year period.

DRILLERS

(Late Wednesday) Press Release - Ensco announced that it has received clearance from the General Authority for Competition in the Kingdom of Saudi Arabia for its pending combination with Rowan Companies. As disclosed on February 21, 2019, shareholders of both Ensco and Rowan voted to approve the pending all-stock transaction under which Rowan shareholders will receive 2.750 Ensco shares for each Rowan share they own. Completion of the transaction, which is expected to occur in April, remains subject to court approval pursuant to a UK court-sanctioned scheme of arrangement and other customary closing conditions.

REFINERS

(Late Wednesday) Reuters - Valero Energy restarted the large hydrocracker at its 335,000-barrel-per-day (bpd) Port Arthur, Texas, refinery. The 57,000-bpd vacuum gas oil hydrocracker was shut for a catalyst change. Hydrocrackers use hydrogen and a catalyst under high heat and pressure to convert gas oil into motor fuels, primarily diesel.

MLPS & PIPELINES

(Late Wednesday) Press Release - Magellan Midstream Partners announced that Aaron Milford has been promoted to chief operating officer effective May 1. Milford previously served as chief financial officer for Magellan. In this newly-created position, Milford will have overall responsibility for the operations, commercial, engineering and information technology aspects of the business.

MARKET COMMENTARY

Futures for major Wall Street indexes struggled for direction, remaining little changed, with the focus on trade negotiations between U.S. and China, even as European indexes rose. Asian shares ended mixed as global growth fears kept investors on the edge. The dollar index rose as more global central banks took a dovish stance, while gold prices fell.

NASDAQ ENERGY TEAM THOUGHT LEADERSHIP


Nasdaq Advisory Services Energy Team Nasdaq's Advisory Services Tamar Essner
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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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