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Oil

Oil Reverses Gains After Decision to Raise Output Gets Delayed

Oil reversed yesterday’s 2% gains after infighting within OPEC+ delayed a much-anticipated decision on raising output levels.

SECTOR COMMENTARY: 

Energy stock futures are pointing to a higher opening as stock futures rise slightly after a better than expected US jobs report. 

Oil reversed yesterday’s 2% gains after infighting within OPEC+ delayed a much-anticipated decision on raising output levels. “This hiccup will not change the inevitable,” said PVM Oil Associates analyst Stephen Brennock. “OPEC+ will relax their production curbs by raising oil output in August. The best time to release additional oil on the market is when you have strong demand growth.” 

U.S. natural gas futures eased from a 30-month high ahead of the July 4th holiday weekend on forecasts for less hot weather and lower demand over the next two weeks than previously expected.  Traders noted that decline came despite a drop in output to the lowest level since gas wells and pipes froze in Texas during February. This week's output decline was due to a problem with a natural gas liquids pipeline in West Virginia.

US INTEGRATEDS

Chevron announced that its wholly owned subsidiary Chevron Australia Pty Ltd. (Chevron Australia) as operator and the Gorgon joint venture participants will proceed with the approximately $4 billion (AU$6 billion) Jansz-Io Compression (J-IC) project. 

INTERNATIONAL INTEGRATEDS

According to ReutersPetroleo Brasileiro said that it would sell its entire stake in oil exploration blocks in the Bacia do Paraná, in line with its efforts to lower debt and focus on deep-water assets. Petrobras PETR4.SA, as the company is known, is selling the PAR-T-198_R12 block, the PAR-T-218_R12 concession and the PAR-T-175_R14 block, it said.

U.S. E&PS 

Laredo Petroleum announced that it has closed its previously announced transactions to acquire the oil-weighted Howard County leasehold of Sabalo Energy, a portfolio company of EnCap Investments L.P., and a non-operating partner, and to partially divest of certain legacy gas-weighted proved developed producing reserves to an affiliate of Sixth Street Partners. Additionally, the Company sold 714,526 shares through its ATM Program at an average price of $65.70 for net proceeds of $45.8 million. Laredo has 16.1 million total shares outstanding as of July 1, 2021, including shares issued in connection with the closing of the Sabalo acquisition.

OILFIELD SERVICES

AAR signed an agreement with Druck, a Baker Hughes business, to offer global aircraft-on-ground support for a range of engine pressure sensors. This service will be performed through AAR´s customer support team and worldwide warehouses network.

Fluor announced its joint venture with Balfour Beatty has broken ground on the Oak Hill Parkway. Fluor was awarded the infrastructure project in April 2020 by the Texas Department of Transportation to widen and improve U.S. 290 and State Highway 71 through Oak Hill, serving as a gateway to the Texas Hill Country.

REFINERS

Tudor Pickering Holt upgraded CVR Energy to Hold.

MLPS & PIPELINES

Cheniere Energy announced that its Board of Directors appointed Patricia K. Collawn and Lorraine Mitchelmore to serve as members of the Board, effective July 1, 2021. Ms. Collawn and Ms. Mitchelmore are considered independent directors. Ms. Collawn has been appointed to the Audit and Compensation Committees and Ms. Mitchelmore has been appointed to the Audit and Governance and Nominating Committees.Cheniere also announced that Nuno Brandolini has retired from its Board, effective July 1, 2021.

MARKET COMMENTARY

Futures contracts tied to the major U.S. stock indexes rose slightly on Friday as the June jobs report beat expectations.  Contracts tied to the Dow Jones Industrial Average rose 86 points, while those for the S&P 500 added 0.3% Nasdaq 100 futures traded higher by about 0.5%.

NASDAQ ENERGY TEAM THOUGHT LEADERSHIP


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