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Markets

Energy Market Commentary: Strength In Crude Complex

Wednesday, January 03, 2018

Sector Commentary

The energy sector is poised for a higher start, supported by strength in the crude complex and major equity indices.

WTI crude oil futures are up ~0.70% in early trading, marginally outpacing Brent and trading near two-and-a-half year highs, backed by ongoing antigovernment protests in Iran. Concerns of robust output in the United States and Russia and doubts emerging about whether demand growth can continue at current levels, kept a cap on the upside.

Natural gas futures were off over 1.7% this morning, sliding after last week's and yesterday's strong gains and despite expectations for demand in lower 48 states to reach an all-time.

U.S. INTEGRATEDs

(Late Tuesday) Reuters - Exxon Mobil reported gas emissions from a Delayed Coker Unit at its Baytown, Texas refinery after a piece of equipment froze.

INTERNATIONAL INTEGRATEDS

Press Release - BP will take a one-off $1.5bn charge in its 2017 fourth quarter earnings as a result of new US corporate income tax rules.

Reuters - Russia's gas exports increased by 8.1 percent to a record high 193.9 billion cubic metres in 2017, Alexei Miller, head of Gazprom , said. Gazprom's gas production, rose by 12.4 percent to 471 bcm, Miller said.

Reuters - Petroleo Brasileiro said that it has agreed to pay $2.95 billion to settle a U.S. class action brought by investors seeking to recoup money they claim to have lost as a result of a corruption scandal.

(Late Tuesday) Reuters - Petroleo Brasileiro said it has received a tax assessment for 17 billion reais related to international money transfers to hire freight services in 2013.

CAnadian INTEGRATEDS

(Late Tuesday) Press Release - Michael Wilson, chair of the board of directors of Suncor Energy is pleased to announce the appointment of Dennis Houston to the company's board. Mr. Houston's appointment is effective Jan. 1, 2018.

U.S. E&PS

Citi downgraded Anadarko Petroleum and Callon Petroleum to 'Neutral' from 'Buy'.

Citi upgraded Cabot Oil & Gas and EOG Resources to 'Buy' from 'Neutral'.

Barclays discontinued coverage of EXCO Resources .

(Late Tuesday) Press Release - Gulfport Energy announced that Donnie Moore has been appointed by the Company's Board of Directors to serve as Chief Operating Officer effective January 8, 2018.

Capital One initiated coverage of Ultra-Petroleum with an Equal-Weight rating.

CANADIAN E&PS

(Late Tuesday) Press Release - Bonavista Energy is pleased to announce the increase to the Exchange Ratio of its exchangeable shares from 1.44650 to 1.45293. This increase will be effective on January 15, 2018.

OIL SERVICES

Press Release - Helix Energy Solutions Group announced the appointment of Geoffrey Wagner as Executive Vice President and Chief Commercial Officer.

REFINERs

Credit Suisse initiated coverage of Andeavor and Marathon Petroleum with 'Outperform' ratings.

Press Release - Andeavor announced that it has agreed to acquire 100% of the equity of Rangeland Energy II, LLC. Rangeland owns and operates assets in the Delaware and Midland Basins, including a recently-constructed crude oil pipeline, three crude oil storage terminals and a frac sand storage and truck loading facility.

Credit Suisse initiated coverage of Holly Frontier , Phillips 66 and Valero Energy with 'Neutral' ratings.

Press Release - PBF Energy provided 2018 guidance: 1Q18 total throughput 800K to 850K bpd - FS 803K; 2018 total throughput 795K to 845K bpd - FS 793K; 2018 capex $525M to $550M - FS $497M.

Reuters - Valero Energy said that it sees FY 2017 capital expenditures of $2,400 million.

MLPs & PipelinES

Press Release - The EnLink Midstream companies, EnLink Midstream, LLC, the General Partner, and EnLink Midstream Partners, LP , the Master Limited Partnership, announced today that EnLink's Boards of Directors have appointed Barry E. Davis to Executive Chairman, Michael J. Garberding to President and Chief Executive Officer, and Eric D. Batchelder to Executive Vice President and Chief Financial Officer.

(Late Tuesday) Press Release - Pembina Pipeline announced several senior executive appointments. The following individuals have been appointed to newly created positions within Pembina's executive team reporting directly to Mick Dilger, Pembina's President & Chief Executive Officer: Jason Wiun as Senior Vice President & Chief Operating Officer, Pipelines, Jaret Sprott, SVP & Chief Operating Officer, Facilities, Stu Taylor, SVP Marketing and New Ventures & Corporate Development Officer and Paul Murphy, SVP & Corporate Services Officer. Scott Burrows, Pembina's SVP & Chief Financial Officer, and Harry Anderson, Pembina's SVP, External Affairs & Chief Legal Officer, will continue in their current roles which they were appointed to on July 1, 2017.

(Late Tuesday) Press Release - TransCanada announced its Leach XPress project was placed in-service on January 1, 2018, and that the Federal Energy Regulatory Commission has issued a certificate of public convenience and necessity for its Mountaineer XPress and Gulf XPress projects on December 29, 2017. All three projects provide vital links between Appalachian natural gas supply and growing U.S. markets.

MARKET COMMENTARY

U.S. stock futures pointed to a higher opening ahead of the Federal Reserve December meeting minutes release. ISM manufacturing data will also be parsed by investors for a reading on the health of the economy. European stocks rose on the back of retailers, while Asian stocks struck a range of new peaks earlier. The dollar edged higher but held near multi-month lows, while gold prices slipped.

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.


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