Markets

Oil Prices Rise After Saudi Crude Production Falls

Monday, August 06, 2018

Sector Commentary

Energy stocks are set for a higher start this morning, tracking gains in the crude complex, while U.S. stock futures were marginally higher as strong corporate earnings countered worries about escalating trade tensions between the United States and China.

Oil prices on both sides of the Atlantic rose in AM trading, after Saudi crude production unexpectedly fell in July and U.S. drilling appeared to slow, although the price is still almost 10% below its 2018 high of more than $80 a barrel. Saudi Arabia pumped around 10.29 million barrels per day (bpd) of crude in July, two OPEC sources said on Friday, down about 200,000 bpd from a month earlier. That came despite a pledge by the Saudis and top producer Russia in June to raise output from July, with Saudi Arabia promising a "measurable" supply boost.

Natural gas futures inched higher, continuing last week's gains on forecasts for above-seasonal temperatures expected for most key consuming regions.

INTERNATIONAL INTEGRATEDS

Press Release - BP is to buy Chargemaster, the UK's largest electric vehicles charging company, and plans to deploy the network across its forecourts in the country over the next 12 months.

(Late Friday) Reuters - Royal Dutch Shell shut the hydrocracker at its 275,000-barrel-per-day joint-venture refinery in Deer Park, Texas.

U.S. E&PS

Press Release - Kosmos Energy announced that the company has entered into an agreement to acquire Deep Gulf Energy, from First Reserve and other shareholders for a total consideration of $1.225 billion, subject to certain adjustments.

Press Release - For the second quarter of 2018, Kosmos Enery generated a net loss of $103.3 million, or $0.26 per diluted share as compared to net loss of $8.5 million or $0.02 per diluted share in the same period last year. When adjusted for certain items that impact the comparability of results, the Company generated an adjusted net loss((1)) of $34.9 million or $0.09 per diluted share for the second quarter of 2018.

(Sunday) Press Release - Lonestar Resources US reported a net loss attributable to its common stockholders of $20.7 million, or ($0.84) per weighted average share, during 2Q18 compared to a net loss of $23.5 million, or ($1.07) per weighted average share during the 2Q17. Excluding, on a tax-adjusted basis, certain items that the Company does not view as either recurring or indicative of its ongoing financial performance, Lonestar's adjusted net loss for 2Q18 was $3.5 million, or ($0.14) per common share.

Press Release - SM Energy Company announced that it has commenced cash tender offers to purchase (i) any and all of its outstanding 6.500% Senior Notes due 2023, and (ii) up to an aggregate principal amount not to exceed $85,000,000, of its 6.125% Senior Notes due 2022, subject to the terms and conditions set forth in the Offer to Purchase and Consent Solicitation Statement dated August 6, 2018, and related solicitation of consents from holders of the 2023 Notes to certain proposed amendments to the indenture governing the 2023 Notes.

Press Release - SM Energy announced that it intends, subject to market and other conditions, to offer $500.0 million in aggregate principal amount of a series of senior unsecured notes due 2027.

Raymond James upgraded WPX Energy to 'Strong Buy' from 'Outperform'.

MARKET COMMENTARY

Fears of the escalating U.S.-China trade conflict kept Wall Street futures little changed, while the dollar advanced broadly. European markets held steady despite weakness in the banking sector, while Asian shares closed mixed. Gold prices dipped. Oil rose after Saudi crude production registered an unexpected decline in July and as U.S. drilling appeared to slow. Employment trends is on the economic tap.

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 . This communication and the content found by following any link herein are being provided to you by Corporate Solutions, a business of Nasdaq, Inc. and certain of its subsidiaries (collectively, "Nasdaq"), for informational purposes only. Nasdaq makes no representation or warranty with respect to this communication or such content and expressly disclaims any implied warranty under law. Sources include Reuters, TR IBES, WSJ, The Financial Times and proprietary Nasdaq research.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.