Energy Sector Update for 06/06/2018: ETP,DVN,ENLK,ENLC,BHP,BBL,RDS.A,RDS.B,CVX,APO,PAA

Top Energy Stocks

XOM +1.60%

CVX +0.37%

COP +0.34%

SLB +0.64%

OXY +0.99%

Energy stocks turned modestly higher this afternoon, reversing prior declines. At last look, the NYSE Energy Sector Index was climbing over 0.2% while shares of energy companies in the S&P 500 were up nearly 0.4% as a group. West Texas Intermediate crude oil for July delivery settled 79 cents lower at $64.73 per barrel in New York while the global benchmark Brent crude July contract rose 22 cents to $75.60 per barrel. July natural gas futures dropped a penny lower to $2.89 per 1 million BTU. Among energy-related ETFs, United States Oil was slipping almost 0.5% - more than halving its previous decline - while United States Natural Gas was posting a 0.2% gain. The Philadelphia oil-service sector index also was up more than 0.6%.

In industry news:

Crude oil extended its recent skid on Wedneday after government data showed U.S. inventories unexpectedly grew last week. Commercial crude supplies rose 2.1 million barrels to 436.6 million barrels during the seven days ended June 1, according to the U.S. Energy Information Administration. That compared with a decline of 2 million barrels from the prior week reported late Tuesday by the American Petroleum Institute and consensus opinion among industry experts polled by S&P Global Platts expecting a drop of 1.3 million barrels.

Among energy stocks moving on news:

- Energy Transfer Partners LP ( ETP ) was trending lower Wednesday afternoon, slipping almost 2% shortly before today's closing bell, after the petroleum transportation and storage company late Tuesday priced a series of private placements of senior notes generating $3 billion in combined proceeds. The company offered $500 million of 4.20% senior notes due 2023 at 99.926% of par as well as $1.0 billion of 4.95% senior notes due 2028 at 99.819% of par. It also issued $500 million of its 5.80% senior notes due 2038 at 99.647% of par along with $1.0 billion of 6.00% senior notes due 2048 at 98.900% of par. The ETP is expecting to use the $2.96 billion in net proceeds from the recent deal to fully repay all of its 2.50% senior notes due June 15 and its 6.70% senior notes maturing July 1, 2018 along with 7.00% senior notes due June 15 that were issued by an Energy Transfer subsidiary.

In other sector news

+ Devon Energy ( DVN ) jumped over 7% on Wednesday after agreeing to sell its ownership interests in EnLink Midstream Partners ( ENLK ) and EnLink Midstream ( ENLC ) to affiliates of privately-held Global Infrastructure Partners for $3.125 billion. Devon said it expects the divesture will lower its consolidated general, administrative and interest costs by around $300 million as well as reducing its consolidated debt by 40%. Almost all of the net proceeds from the property transfer will be used for share repurchases, with Devon Wednesday also announcing a three-fold increase in the authorization for its stock-buyback progam to $4 billion.

+ BHP Billiton (BHP,BBL) advanced Wednesday, with American depository shares climbing almost 2% soon after the opening bell after the natural resources giant reportedly received first-round bids for its U.S. shale portfolio, valuing the oil and natural gas assets between $7 billion to $9 billion. At least two energy majors - Royal Dutch Shell (RDS.A,RDS.B) and Chevron ( CVX ) - submitted bids for the properties in addition to several parties, including Apollo Global Management (APO), making offers for selected parts of the portfolio, according to sources close to the matter. Second-round bids will be due as soon as July, the sources said.

+ Plains All American Pipeline LP (PAA) rose Wednesday after analysts at DA Davidson raised their investment recommendation for the energy infrastructure and logistics company to Buy/Add and also increased their price target for the company's stock by $7 to $27 a share. The upgrade follows Plains All American May 8 announcing better-than-expected Q1 financial results. Excluding one-time items, the company earned $0.36 per share during the three months ended March 31 on $8.4 billion in revenue compared with the Street view that expected a $0.33 per share non-GAAP Q1 profit on $7.38 bilon.

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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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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