Oil Prices Mixed on Cancelled Flights, Omicron Optimism
SECTOR COMMENTARY:
The energy sector is set to kick off the final week of trading for the year mixed to lower start, tracking a fall in U.S. crude prices but supported mild strength in the major equity futures which steadied as investors assess the spread of the omicron Covid-19 variant.
WTI crude oil futures drooped ~0.50% IN early trading, trailing Brent which is up modestly in this morning, falling after U.S. airlines called off thousands of flights over the Christmas holidays amid surging COVID-19 cases, though losses were capped and Brent higher on hopes that the Omicron variant will have limited impact on global demand. More than 1,300 flights were cancelled by U.S. airlines on Sunday as COVID-19 reduced the number of available crews while several cruise ships had to cancel stops. Traders will also be looking for headlines from the talks that resumed today between world powers and Iran on reviving Tehran's 2015 nuclear deal. Iran on Monday said that oil exports were the focus of the talks, which so far appear to have made little progress on boosting Iran's shipments. Also on investors' radar is the next OPEC+ meeting on Jan. 4, in which the producer alliance will decide whether to go ahead with a planned 400,000 barrels per day (bpd) production increase in February.
Natural gas futures surged ~4% this morning, backed by cooler weather forecast in key consuming regions that should spur demand.
BY SECTOR:
US INTEGRATEDS
No significant news.
INTERNATIONAL INTEGRATEDS
Egyptian General Petroleum Corporation (EGPC) signed an agreement with Eni for oil exploration in the Gulf of Suez and Nile Delta regions worth "not less than $1 billion" of investments, the petroleum ministry said on Friday, Reuters reported. The agreement also included a commitment from Eni to additionally spend "not less than $20 million" to drill 4 wells, the ministry added in a statement.
Petrobras said on Thursday it signed a deal to sell its stake in the onshore Polo Carmópolis area to Carmo Energy S.A. for $1.1 billion, Reuters reported. It said $275 million would be paid up front, $550 million when the deal closes, and a further $275 million one year after closure of the deal, which still needs regulatory approval. The Polo Carmópolis area is comprised of 11 onshore concessions in the state of Sergipe.
CANADIAN INTEGRATEDS
No significant news.
U.S. E&PS
Siebert Williams initiated coverage of Chesapeake Energy with a Buy rating.
CANADIAN E&PS
No significant news.
OILFIELD SERVICES
According to SEC filing, on December 21, 2021, Martin Marietta Materials entered into a Credit Agreement with JPMorgan Chase Bank, N.A., as Administrative Agent and an Issuing Lender, Deutsche Bank AG New York Branch, PNC Bank, National Association, Truist Bank, and Wells Fargo Bank, National Association, as Syndication Agents, and the lenders and issuing lenders party thereto, which provides for an $800,000,000 five-year senior unsecured revolving facility. Borrowings under the Revolving Facility bear interest, at the Corporation’s option, at rates based upon LIBOR or a base rate, plus, for each rate, a margin determined in accordance with a ratings-based pricing grid. The Corporation may, subject to certain conditions, increase the total amount available under the Revolving Facility to $1,050,000,000.
DRILLERS
No significant news.
REFINERS
PBF Energy announced that Paul Donahue has been elected as an independent director effective January 1, 2022.
MLPS & PIPELINES
No significant news.
MARKET COMMENTARY
Market Commentary not available.
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.
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