Energy Sector Update for 08/08/2018: PAA, PVAC, VEDL, PE
Top Energy Stocks
Energy stocks pared some of their earlier declines, with the NYSE Energy Sector Index falling over 0.5% while shares of energy companies in the S&P 500 were down more than 0.6% as a group. West Texas Intermediate crude oil for September delivery settled $2.23 lower, falling over 3% to $66.94 per barrel at the New York Mercantile Exchange while the global benchmark Brent crude October contract declined $2.32 cents to $72.33 per barrel. September natural gas futures rose 5 cents to $2.95 per 1 million BTU. Among energy-related ETFs, United States Oil fell just over 3.0% while United States Natural Gas rose more than 1.7%. The Philadelphia Oil Service Sector index was down almost 0.4% in late trade today.
In industry news:
Crude oil prices extended their slide Wednesday afternoon following a smaller-than-expected decline in U.S. inventories during the seven days ended August 3, falling by 1.35 million barrels to 407.4 million barrels, the Energy Information Administration said this morning. That compares with the American Petroleum Institute late Tuesday reporting a drop of 6 million barrels last week and industry experts polled by S&P Global Platts expecting a 3.1 million-barrel drawdown in U.S. supplies. The federal agency also reported a surprise increase of 2.9 million barrels in gasoline stocks last week compared with expectations for a 1.1 million-barrel decline.
Among energy stocks moving on news:
+ Plains All-American Pipeline LP ( PAA ) touched a 13-month high on Wednesday, rising nearly 7% to $26.70 per unit, after the petroleum transportation and storage company reported non-GAAP Q2 net income of $0.38 per unit, improving on a $0.21 per unit adjusted profit during the same quarter last year and topping the Capital IQ consensus by $0.14 per unit. Revenue surged to $8.08 billion from $6.08 billion during the same quarter last year and also exceeding the $8.02 billion Street view.
In other sector news
+ Penn Virginia Corp ( PVAC ) rose Wednesday trading, reversing a nearly 2% morning advance that followed the oil and natural gas producer reporting adjusted Q2 net income and revenue topping analyst estimates. Excluding one-time items, it earned $2.46 per share, improving on a $0.66 per share non-GAAP profit during the year-ago period and handily beating the Capital IQ consensus by $0.21 per share. Total revenue rose to $111.6 million over $77.2 million during the same quarter last year and also exceeding the $105.3 million analyst mean.
- Vedanta ( VEDL ) was more than 3% lower Wednesday afternoon following reports the Indian natural resources company could secure as many as 40 oil and natural gas exploration blocks in India's first-ever acreage auction. In addition to Vedanta likely submitting the winning bid for 40 of the available 55 properties, sources told Bloomberg News that Oil India may secure six of the exploration blocks through the auction while Oil and Natural Gas could secure another two or three properties while Hindustan is likely to walk away with one block.
- Parsley Energy ( PE ) was falling Wednesday, sinking over 6% in recent trading, despite posting Q2 revenue exceeding Wall Street expectations and net income matching analyst estimates. Excluding one-time items, the oil and natural gas producer earned $0.39 per share during the April-to-June reporting period on $467.8 million in revenue, or more than double its $213.7 million in revenue last year and breezing past the Capital IQ consensus expecting $432.3 million in quarterly revenue.
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