Energy Sector Update for 03/08/2018: FMSA, HES, TOT

Top Energy Stocks

XOM, -0.3%

CVX, -0.6%

COP, -1.2%

SLB, +0.6%

OXY, -2.5%

Energy stocks were mostly lower today, with the NYSE Energy Sector Index (^NYE) falling nearly 0.1% while shares of energy companies in the S&P 500 ( XLE ) were down almost 0.2% as a group. Crude oil for April delivery was slipping 90 cents to $60.26 per barrel in New York while the benchmark Brent crude April contract was declining 52 cents to $63.82 per barrel. April gas futures were 3 cents lower at $2.75 per 1 million BTU. Among energy-related ETFs, United States Oil ( USO ) was down over 1.7% while United States Natural Gas ( UNG ) was down more than 1.2%. The Philadephia oil-service sector index (^OSX) was up some 0.04%.

In industry news:

The Energy Information Administration Thursday reported a decline of 57 billion cubic feet in U.S. natural gas inventories during the week ended March 2, down compared with a draw of 78 billion cubic feet during the prior week. The decline was the 16th weekly drawdown of the current heating season.

Oil prices were falling for a second day after the EIA Wednesday reported rising U.S. production and higher crude oil inventories during the same seven days ended March 2, fueling more worries that increased supplies will work to undercut prices. Industry experts also are attributing the recent weakness in crude oil prices to changes from the traditional pattern of a dip in demand during Q2 ahead of the summer travel season. "Importantly, oil demand data over the past decade shows that this demand seasonality is changing, with 1Q oil demand often the weakest and demand rising gradually from there," according to Goldman Sachs in a new analysis report. "This new pattern suggests that while expectations for demand growth may be low for 2Q, the seasonal trough in demand may actually be already occurring."

Among energy stocks moving on news:

Hess ( HES ) was trading higher Thursday, at one point rising 0.5% after the oil and natural gas company added another $500 million to existing stock buyback program, authorizing the repurchase of up to $1 billion of its common shares this year. Under the new authorization, the company will repurchase and retire $500 million of its common stock through an accelerated stock repurchase program and using the remaining $500 million to buy back its common stock through open-market transactions through Dec. 31.

In other sector news

+ Total SA ( TOT ) still was narrowly higher, easing from a 1% gain earlier Thursday to a session high of $57.53 a share that followed the French energy major saying it has completed its $4.95 acquisition of Denmark-based Maersk Oil from AP Moller-Maersk A/S. Total issued around 97.5 million shares of its common shares to AP Moller-Maersk in the EUR4.21 billion transaction.

- Fairmount Santrol Holdings (FMSA) slumped Thursday, falling more than 14% to a session low of $3.85 a share, after the oilfield-services company reported below-consensus Q4 financial results. The company swung to a net profit of $0.09 per share during the three months ended Dec. 31, reversing a $0.09 per share net loss during the same quarter in 2016 but still trailing the Capital IQ consensus by $0.05 per share. Revenue grew tp $273.9 million from $140.5 million last year, although that also fell short of the $279.5 million analyst mean.

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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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