Leadership

Crude Slips on Global Economic Growth Concerns

Wednesday, March   20, 2019

SECTOR COMMENTARY

The energy sector is poised for a mixed to lower start, weighed down by weakness across the underlying commodities while major equity futures were flat as investors waited for more clarity on the Federal Reserve’s interest rate outlook for the year and lingering trade war concerns.

WTI crude oil futures were down over 1% in early trading, trailing Brent, dragged down by concerns about global economic growth as the U.S.-China trade dispute continued but losses were limited by a bullish API report. The industry report last night ahead of the EIA weekly this morning had draws across the board for crude, gasoline, distillates and Cushing.  Profit-taking from annual highs reached yesterday also weighed on prices. 

Natural gas futures were off roughly 1.3% this morning, pressured by warming weather forecasts in key consuming regions that should limit demand.

INTERNATIONAL INTEGRATEDS

(Late Tuesday) Reuters - The Brazilian government is likely to pay around $10 billion to Petroleo Brasileiro to settle the so-called 'transfer-of-rights' dispute, though the parties have not agreed on final terms.

Reuters - A.P. Moller-Maersk said it has sold 17,272,593 existing ordinary shares in Total representing Moti’s entire shareholding in total, through an accelerated book-building process. The gross sale proceeds of the offering amount to approximately EUR 884 million, equal to EUR 51.18 for each ordinary share.

U.S. E&PS

Imperial Capital downgraded Approach Resources to ‘Underperform’ from ‘In-Line.’

(Late Tuesday) Press Release - Westport Fuel Systems reported consolidated revenues for the quarter ended December 31, 2018 increased by $3.0 million to $60.5 million, or 5% over the same period last year. Consolidated gross margin for the quarter ended December 31, 2018 decreased by $1.7 million to $12.3 million over the same period last year. Net loss from continuing operations for the quarter ended December 31, 2018 was $10.4 million or a loss of $0.08 per share, compared with net loss of $20.8 million or $0.14 per share in the same period last year. 

OILFIELD SERVICES 

Press Release - CGG announced that Sercel has launched its first distributed acoustic sensing (DAS) seismic solution: SigmaWave. Designed in partnership with Fotech Solutions, SigmaWave is the first integrated distributed acoustic solution designed exclusively for borehole seismic applications. It is a new and integral part of Sercel’s existing downhole seismic equipment portfolio and allows continuous, real-time, seismic measurements via fiber optic cable.

Press Release - KBR announced the sail-away of the Johan Sverdrup Utilities and Living Quarter (ULQ) Platform for Equinor (formerly Statoil) in the North Sea.

Press Release - McDermott International announced that it has been awarded a large* technology contract for the basic engineering and licensing of Irkutsk Oil Company's (IOC) 650 KTA ethylene plant in Russia, plus the detailed engineering and material supply of six SRT (Short Residence Time) pyrolysis heaters for the plant. The plant will be designed to produce 650 KTA of polymer grade ethylene from ethane and propane, and will also produce high-purity hydrogen and C5 by-products.

Press Release - TechnipFMC has been awarded a significant Subsea contract by Equinor for the Johan Sverdrup Phase 2 development, located in the Norwegian sector of the North Sea at a water depth of 120 meters. The contract covers the delivery and installation of the subsea production system including integrated template structures, manifolds, tie-in and controls equipment.

MLPS & PIPELINES 

Press Release - Enterprise Products Partners announced that it will again team up with CME Group to conduct an electronic auction offering U.S. crude oil for export from the Enterprise Hydrocarbon Terminal (“EHT”) on the Houston Ship Channel. During the auction, which will take place April 4, 2019, bids will be accepted for WTI light sweet crude oil using CME Group’s proprietary spot auction platform. The auction will be the second to take place since the launch of a physically delivered NYMEX WTI Houston Crude Oil futures contract in November of 2018. In addition to EHT, the NYMEX Houston WTI futures contract also offers delivery of crude oil at Enterprise’s ECHO and Genoa Junction terminals.

MARKET COMMENTARY

U.S. stock futures were flat ahead of the Federal Reserve's interest rate decision later in the day. European shares retreated from near six-month highs, with German stocks leading losses as fall in Bayer stocks weighed on the index following a U.S. court verdict on weed killer Roundup's link to cancer. Asian stocks ended mixed, with uncertainty over Sino-U.S. trade war hitting investors' nerves. The dollar edged up, while gold prices fell.

NASDAQ ENERGY TEAM THOUGHT LEADERSHIP


Nasdaq Advisory Services Energy Team Nasdaq's Advisory Services 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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