Oil Up Amid Continued Supply Tightness
SECTOR COMMENTARY:
The energy sector is set for a higher start, supported by gains in crude futures.
Crude contracts are kicking-off the fourth-quarter in positive territory, on the continued supply tightness theme and after U.S. legislators were able to come to a temporary short term funding agreement that staved off a government shutdown. Adding to concerns over tight supply, OPEC Secretary General Haitham Al Ghais said the group still sees "oil demand as quite resilient this year, as it was last year." Speaking at the ADIPEC energy industry event in Abu Dhabi, minister Suhail al-Mazrouei mentioned the need to invest more in oil and gas to make prices “right at the pump”.
Natural gas futures are trading down ~1% on forecasts for lower demand than previously expected.
BY SECTOR:
US INTEGRATEDS
No significant news.
INTERNATIONAL INTEGRATEDS
A panel reviewing a $2 billion offer by Abu Dhabi's national oil company and BP to acquire a 50% stake in Israeli gas producer NewMed has recommended raising the asking price by over 10%, casting doubt over the deal, sources said. The proposed acquisition by Abu Dhabi National Oil Co (ADNOC) and BP was seen as a sign of the strengthening economic links between Israel and the United Arab Emirates since the two countries agreed to normalise ties in 2020. The independent panel of three members was set up by NewMed after the proposed deal was announced in March to examine the terms of the $2 billion offer and seek competing bids.
BP interim CEO Murray Auchincloss said that the energy company's strategy remains on track following the abrupt resignation of Bernard Looney last month. "We laid out an update to the strategy in February, seven months ago. That's a strategy that's endorsed by the management team and endorsed by the board, one person leaving does not change the strategy,” Auchincloss said, speaking on a panel at the ADIPEC conference in Abu Dhabi.
BP said David Lawler, the head of its U.S. arm and chief executive of its U.S. shale oil operation BPX, has notified the company of his intent to leave. Lawler will be replaced as president of BP America by Orlando Alvarez, the company said.
According to Reuters, Eni made gas discovery in Kutei Basin in Indonesia. Well production test (DST) has allowed to estimate well capacity of up to 80-100 MMSCFD, about 5-6 KBBLD of condensate.
CEO ENI Claudio Descalzi said that a balanced situation was needed for oil prices. "We need a price that allows us to make investment and we need a price that is not against consumers because otherwise you reduce the capability to spend and then you destroy your market. So we need a balanced situation," Descalzi told reporters at an energy conference in the UAE's capital.
South Africa's environment ministry has rejected a wide-ranging appeal against TotalEnergies' drilling for gas and oil in Block 5/6/7 off the Cape coast, after the latest in a series of challenges seeking to halt energy companies exploring for new offshore discoveries at the foot of Africa.
TotalEnergies signed a new 15-year renewable Power Purchase Agreement (PPA) with Saint-Gobain. This is the second long-term solar power supply agreement designed to help decarbonize the power consumption of the building materials company's 125 industrial sites in North America. By signing this PPA with Saint-Gobain, TotalEnergies is once again demonstrating its commitment to offering tailor-made renewable energy solutions to businesses worldwide, as it has done with Air Liquide, Amazon, Merck, Microsoft, Orange and Sasol.
CANADIAN INTEGRATEDS
No significant news.
U.S. E&PS
The chief executive officer of U.S. oil and gas producer Occidental Petroleum said it was important for energy companies to be included in the climate debate because they offered solutions to mitigate climate change. Vicki Hollub, speaking at the ADIPEC conference in Abu Dhabi, on Monday, said the company was investing in a way that provided energy security as well as shareholder value.
CANADIAN E&PS
No significant news.
OILFIELD SERVICES
Baker Hughes announced that it has been awarded a major contract, to be booked in the third quarter of 2023, to provide a modularized liquefied natural gas (LNG) system and power island. The contract was awarded under a master equipment supply agreement between Venture Global LNG and Baker Hughes for more than 100 million tons per annum (MTPA) of production capacity, which was expanded from 70 MTPA and recently announced during Gastech in Singapore.
Enerflex announced that Rodney D. Gray has resigned from his role as Senior Vice President and Chief Financial Officer to pursue other opportunities. Enerflex has initiated a search process to identify the Company's next CFO and has retained an executive search firm to assist with the process.
ProFrac Holding announced that it is evaluating strategic options to maximize and realize the full value of its Proppant Production segment, which operates through its wholly-owned Alpine Silica subsidiary. A variety of options are under strategic review, including a public offering, a sale or merger of Alpine Silica and/or a potential recapitalization.
SLB, Aker Solutions and Subsea7 announced today the final closing of their previously announced joint venture. The new business, which will adopt the OneSubsea name, will drive innovation and efficiency in subsea production by helping customers unlock reserves and reduce cycle time.
DRILLERS
Noble Corporation announced that Ms. Jennifer Yeung had joined the Company and will assume the role of Vice President, Chief Accounting Officer immediately following the Company's filing of its Form 10-Q for the third quarter of 2023. In this position, Ms. Yeung will serve as the Company's principal accounting officer. Ms. Yeung will succeed Ms. Laura Campbell, who will continue as Senior Advisor to the CFO to assist with the transition, until her retirement from the Company on March 15, 2024.
REFINERS
No significant news.
MLPS & PIPELINES
No significant news.
MARKET COMMENTARY
Wall Street index futures edged higher after the U.S. Congress averted a government shutdown, while investors awaited comments from Federal Reserve Chair Jerome Powell for clues on the central bank's interest-rate path. European stocks were fractionally higher, while Nikkei erased earlier gains to close lower. Oil rose as focus returns to supply outlook and gold fell on a surging dollar. ISM & S&P Global manufacturing PMIs for the U.S. are scheduled later in the day.
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 Rich Pontillo.
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Nasdaq Advisory Services Energy Team is part of Nasdaq's Advisory Services. 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.
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