Oil

Crude Gains Ahead of Trade Talks

Crude oil futures are gaining ground after OPEC’s monthly report released showed non-OPEC supply growth estimate cuts were larger than global demand cuts, while 2020 demand was left unchanged and 2020 non-OPEC supply growth was lowered. 

SECTOR COMMENTARY

Energy stocks are set to open higher, being lifted by a nearly 1% gain in crude oil prices, though slightly lower index futures may offset the commodity-led strength.  Sector news flow continues to slow as earnings blackout periods begin to take effect, while the U.S.-China trade talks, and the likely heavy dose of headlines set to hit over the next two days, will be a key component for trading.

Crude oil futures are gaining ground after OPEC’s monthly report released showed non-OPEC supply growth estimate cuts were larger than global demand cuts, while 2020 demand was left unchanged and 2020 non-OPEC supply growth was lowered.  "No two ways about it, U.S.-China trade talks will be front and centre on the agenda across global markets, including oil," said BNP Paribas oil strategist Harry Tchilinguirian.  "This jitteriness just goes to show how much emphasis the market places on the outcome of these talks in terms of the global economic outlook."

Natural gas futures are higher by 2 cents ahead of weekly inventory data.  Analysts expect a build of 99 bcf vs the 5-year average of +89 bcf.

U.S. INTEGRATEDS

Reuters - BP, Chevron, and Royal Dutch Shell are among firms that will compete for exploration and production rights off the Brazilian coast, in the first of three oil bidding rounds scheduled for coming weeks. Combined, the minimum signing bonuses for the blocks in the so-called 16th post-salt oil bidding round in the Latin American oil powerhouse come to roughly $800 million.

INTERNATIONAL INTEGRATEDS

Press Release - BP Ventures has led a Series A funding round in Grid Edge - a developer of artificial intelligence (AI) technology - that enables customers to predict, control and optimise their building’s energy profile. The investment is in support of BP Alternative Energy’s wider strategy of low-carbon power, storage and digital energy.

Reuters - BP, Chevron, and Royal Dutch Shell are among firms that will compete for exploration and production rights off the Brazilian coast, in the first of three oil bidding rounds scheduled for coming weeks. Combined, the minimum signing bonuses for the blocks in the so-called 16th post-salt oil bidding round in the Latin American oil powerhouse come to roughly $800 million.

Reuters - Royal Dutch Shell said it would offset the carbon dioxide emissions of around 1.5 million road users in Britain starting later this month under a loyalty scheme.

U.S. E&PS

Seaport Global Securities downgraded the following from ‘Buy’ to ‘Neutral’: Abraxas, Centennial Resources, Comstock Resources, Devon Energy, Earthstone Energy, HighPoint Resources, Jagged Peak, Lonestar, Rosehill Resources, Sundance Energy, SM Energy, Whiting Petroleum.

Press Release - Callon Petroleum announced that it has filed definitive proxy materials with the U.S. Securities and Exchange Commission in connection with the Company's pending all-stock acquisition of Carrizo Oil & Gas. Callon will commence mailing the joint proxy statement / prospectus to its shareholders on or about October 11, 2019.

Mizuho Securities downgraded Continental Resources to ‘Neutral’ from ‘Buy.’

Mizuho Securities upgraded Pioneer Natural Resources to ‘Buy’ from ‘Neutral.’

CANADIAN E&PS

Press Release - Canacol Energy reported natural gas sales for the third quarter of 2019 averaged approximately 146 million standard cubic feet per day, compared to 120.5 MMscfpd for the second quarter of 2019. Natural gas sales for the first 9 days of October 2019 averaged 211 MMscfpd. As a result of the Promigas pipeline delay this year, whereby the expansion was to be delivered on June 1, 2019 but instead was delivered in full on August 24th, 2019, average annual gas sales for 2019 are forecast to be approximately 150 MMscfpd. The company also said that the Clarinete 4 development well was spud on September 3, 2019 and reached a total depth of 8,450 feet measured depth on September 18, 2019. The well encountered 297 feet true vertical depth of net gas pay in the Cienaga de Oro sandstone reservoir with average porosity of 22%.

OILFIELD SERVICES

Press Release - Fluor announced that its joint venture COOEC-Fluor Heavy Industries, Co., Ltd. fabrication yard in Zhuhai, China, has safely completed the pipe spool fabrication portion of its scope of work in support of the Kuwait Integrated Petroleum Industries Company (KIPIC) Al-Zour project in Kuwait. In addition to the recently completed pipe spool fabrication scope of work, COOEC-Fluor is fabricating and assembling 188 modules with final loadout and shipping to the project site planned for October.

Press Release - ProPetro Holding Corp. announced a number of changes to its Executive Leadership Team in connection with the substantial completion by the Audit Committee of fact finding associated with its previously disclosed internal review. Fact-Finding Key Items: Substantially completed fact finding for previously disclosed internal review. The Audit Committee and management have not identified to date any items that would require restatement of the Company’s previously reported balance sheets, statements of operations, statements of shareholders’ equity or statements of cash flows. Announced new management appointments along with improved organizational structure to strengthen internal controls. Plans to make required SEC filings and become current in its filing obligations as soon as reasonably practicable.

MARKET COMMENTARY

U.S. stock index futures were little changed as investors waited to hear on any progress in U.S.-China trade talks starting later in the day. Most Asian indexes enjoyed a broadly positive finish, while European stocks traded range-bound. A dive in the dollar pushed the euro higher. Oil prices pared losses. Spot gold edged higher, while gold futures surrendered gains.

NASDAQ ENERGY TEAM THOUGHT LEADERSHIP 


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


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