Energy Sector Update for 08/10/2018: JAG,KMI,XOM,BX,APA,ERF,PBF,BHGE

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Top Energy Stocks

XOM -0.26%

CVX +0.47%

COP +0.13%

SLB +0.75%

OXY +1.13%

Energy stocks were ending broadly mixed this afternoon, with the NYSE Energy Sector Index Thursday falling over 0.4% in late trade while shares of energy companies in the S&P 500 were up nearly 0.5% as a group. West Texas Intermediate crude oil for September delivery settled 82 cents higher at $67.63 per barrel at the New York Mercantile Exchange while the global benchmark Brent crude October contract advanced 85 cents to $72.92 per barrel. September natural gas futures fell a penny to $2.94 per 1 million BTU. Among energy-related ETFs, United States Oil was climbing almost 1.4% while United States Natural Gas was dropping nearly 0.3%. The Philadelphia Oil Service Sector index was up more than 1.0% today.

In industry news:

Crude oil prices settled higher Friday after the International Energy Agency raised its 2019 demand forecast by 110,000 barrels per day, now expecting oil use next year to climb by 1.5 million barrels per day. The agency also said in its monthly market outlook that it expects new sanctions on Iran's energy industry to renew supply concerns when they take effect in November.

Also, U.S. energy companies brought another 10 drillrigs into the field this week, boosting the number of active rigs operating throughout the country during the seven days ended August 10, to 869 rigs, reaching their highest level since March 2015, according to weekly census data compiled by Baker Hughes ( BHGE ). Natural gas producers also added three more rigs this week, lifting the U.S. total for gas rigs to 186 and the combined rig count in the United States climbing to 1,057. Canadian producers pulled 12 oil rigs and two gas rigs this week for a combined total of 209 and consisting of 140 oil rigs and 69 gas rigs. The North American total fell by a single net rig to 1,266 rigs, or 97 more rigs in use compared with the first full week in August 2017.

Among energy stocks moving on news:

+ Jagged Peak Energy ( JAG ) resisted the downward bias for most stocks today, rising almost 5% in late trade, after reporting a four-fold increase in Q2 net income compared with the year-ago period and revenue almost triple over last year's total. The exploration and production company earned $0.20 per share during the three months ended June 30, up from $0.05 during the April-to-June fiscal period last year and beating the Capital IQ consensus by $0.06 per share. Revenue grew to $158.7 million from $53.1 million last year, representing a % year-over-year increase and also topping the $140.4 million analyst mean.

In other sector news:

+ Kinder Morgan ( KMI ) edged higher on Friday, rising over 1%, after energy major Exxon Mobil ( XOM ) signed a letter of intent in support of its proposed Permian Highway natural gas pipeline project in Texas. Exxon, through its XTO Energy subsidiary, could contract up to 450,00 dekatherms per day of capacity from the project's original partners, Kinder Morgan and the Blackstone Group ( BX ) through its EagleClaw Midstream Ventures portfolio company. Apache Corp (APA) also is a partner in the project, which has an option to buy a one-third stake in the new pipeline.

- Enerplus (ERF) was back on positive ground late in Friday trading, partially recovering from a mid-morning decline that erased all of a more than 2% gain that followed the Canadian oil and natural gas producer reporting non-GAAP Q2 net income of CAD0.05 per share, falling more than 90% from its CAD0.52 per share non-GAAP profit during the year-ago period. Analysts, on average, had been expecting a CAD0.25 per share adjusted profit for the April-to-June reporting period, if comparable.

- PBF Energy (PBF) tumbled almost 5% at one point on Friday after the refinery company priced a $291 million public offering of 6 million shares of its class A common stock at $48.50 each, equal to a 3.4% discount to the stock's last closing price. Underwriters received a 30-day option to buy up to 900,000 additional shares, which if fully exercised would increase the gross proceeds to nearly $334.7 million.

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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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