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SECTOR COMMENTARY:
The energy sector is set for a lower start, pressured by weakness in the major averages. U.S stocks are expected to begin the holiday-shortened week in negative territory as retailers Walmart and Home Depot both lowered full-year earnings expectations which increased signs of a likely economic recession.
WTI and Brent crude oil are trading mixed during a choppy morning as concerns over an economic slowdown slightly outweigh forecasts for higher demand and tighter supply. Brent crude oil futures were briefly trading higher following better-than-expected business activity surveys in Europe and the UK which pointed to a less gloomy European outlook than previously expected. In international news, Russia plans to cut oil production by 500K barrels or 5% of its output in March following sanctions from the West over its invasion of Ukraine.
Natural gas futures are trading lower on forecasts for warmer weather in the next two weeks than previously expected.
BY SECTOR:
US INTEGRATEDS
No significant news.
INTERNATIONAL INTEGRATEDS
Equinor has agreed to sell its South Riding Point oil terminal in the Bahamas to Estonian logistics and investment company Liwathon Group, the Norwegian oil and gas producer.
Equinor has entered into an agreement with Liwathon for the sale of the Equinor South Riding Point oil terminal at the Grand Bahama Island in the Bahamas.
From 13 February until 17 February, Equinor ASA has purchased a total of 1,637,406 own shares at the Oslo Stock Exchange at an average price of NOK 326.1402 per share.
Petrobras said its Chief Executive Officer Jean Paul Prates has appointed Sergio Caetano Leite to be the company’s chief financial officer.
CANADIAN INTEGRATEDS
Veritas Research upgraded Cenovus Energy to Buy from Sell.
Suncor Energy named Rich Kruger as its chief executive officer, effective April 3.
Stifel Nicolaus & Co initiated coverage on TXO Energy Partners LP with a Buy rating. Raymond James initiated coverage with a Strong Buy rating and Capital One Securities initiated coverage with an Overweight rating.
U.S. E&PS
Gerdes Energy Research upgraded Pioneer Natural Resources to Buy from Neutral.
CANADIAN E&PS
No significant news.
OILFIELD SERVICES
Fluor announced financial results for its year ended December 31, 2022. Revenue for 2022 was $13.7 billion and net income from continuing operations attributable to Fluor was $145 million, or $0.73 per diluted share. Consolidated segment profit2 for the year was $427 million compared to $415 million in 2021. Excluding the adjustments outlined in the reconciliation table at the end of this release, the company recognized adjusted earnings per diluted share2 of $0.82 for 2022. Results for the year reflect an average tax rate of 70% due to the current mix of global earnings and losses in jurisdictions that provide no tax benefit.
Fluor announced that it was awarded a reimbursable contract by Dow to provide front-end engineering and design (FEED) and engineering, procurement and construction management (EPCM) services for the world’s first net-zero carbon emissions ethylene cracker and derivatives complex in Fort Saskatchewan, Alberta, Canada. Fluor will book the initial FEED award in the first quarter and anticipates the additional EPCM scope will be awarded throughout 2023 pending a final investment decision by Dow’s Board of Directors.
Forum Energy Technologies announced fourth quarter 2022 revenue of $191 million, a $9 million increase from the third quarter 2022. Orders received were $215 million, with a book-to-bill ratio of 113%. The fourth quarter net loss was $13 million, or $2.22 per diluted share, compared to net income of $17 million, or $1.82 per diluted share, for the third quarter 2022. Excluding $10 million, or $1.77 per share, for special items, adjusted net loss was $0.45 per diluted share, compared to an adjusted net loss of $0.25 per diluted share in the third quarter.
KBR announced that it has launched Sustainable Aviation Fuel (SAF) technology in alliance with Swedish Biofuels AB, a technology developer and pioneer in cutting-edge research on biofuels.
TechnipFMC has been awarded a significant contract to supply flexible pipe and associated hardware for the first subsea life extension project by TotalEnergies EP Angola and its Block 17 Partners in West Africa.
DRILLERS
Valaris Limited reported fourth quarter 2022 results. Net income was $31 million compared to $78 million in the third quarter 2022. Adjusted EBITDA decreased to $54 million from $76 million in the third quarter. Adjusted EBITDAR decreased to $75 million from $94 million in the third quarter. Revenues decreased to $434 million from $437 million in the third quarter 2022. Excluding reimbursable items, revenues decreased to $413 million from $416 million in the third quarter primarily due to lower utilization and lower average day rates for the harsh environment jackup fleet, partially offset by an increase in utilization for the floater fleet.
REFINERS
No significant news.
MLPS & PIPELINES
Crestwood Equity Partners reported its financial and operating results for the three months ended December 31, 2022. Fourth quarter 2022 net income of $53.9 million, compared to net income of $78.6 million in fourth quarter 2021; full-year 2022 net income of $72.5 million, compared to a net loss of $37.4 million in 2021. Fourth quarter 2022 Adjusted EBITDA of $200.3 million, compared to $149.1 million in the fourth quarter 2021, an increase of 34% year-over-year; full-year Adjusted EBITDA of $762.1 million, compared to $600.1 million in 2021, an increase of 27%
Equitrans Midstream announced financial and operational results for the full-year and fourth quarter 2022. Included in the “Non-GAAP Disclosures” section of this news release are important disclosures regarding the use of non-GAAP supplemental financial measures, including information regarding their most comparable GAAP financial measure. Generated $846 million of net cash from operating activities and $380 million of free cash flow. Recorded 71% of total operating revenue from firm reservation fees.
Williams announced it has joined the United Nations Environment Programme’s (UNEP) Oil and Gas Methane Partnership 2.0 (OGMP 2.0), the global initiative designed to improve the energy industry’s methane emissions reporting and to encourage progress in reducing those emissions. Joining OGMP 2.0 supports Williams’ next generation natural gas strategy to drive transparency and decarbonization of the natural gas value chain through technology investments, providing path-specific methane intensity certifications to utilities, LNG export facilities and other clean energy users.
Williams announced its unaudited financial results for the three and 12 months ended Dec. 31, 2022. Fourth-quarter 2022 Adjusted EBITDA increased by $291 million over the prior year, driven by the previously described benefits from service revenues, commodity margins, and upstream operations, partially offset by higher operating costs. Full-year 2022 Adjusted EBITDA increased by $783 million over the prior year due to similar drivers, but also reflecting higher administrative costs and the absence of the favorable impact in 2021 from Winter Storm Uri. Fourth-quarter 2022 Adjusted Income improved by $177 million over the prior year, driven by the previously described impacts to net income, adjusted primarily to remove the effects of net unrealized gains/losses on commodity derivatives and amortization of certain assets from the Sequent acquisition. Full-year 2022 Adjusted Income improved by $570 million over the prior year driven by the previously described impacts to net income, adjusted primarily to remove the effects of net unrealized gains/losses on commodity derivatives, amortization of certain assets from the Sequent acquisition, and favorable income tax benefits.
MARKET COMMENTARY
U.S. stock futures fell on fears that interest rates will remain higher for longer coupled with disappointing results from Home Depot, which added to the gloomy mood. European shares fell following a cautious forecast from HSBC, while an upbeat performance in Engie helped trim some losses. Japan’s stock markets ended lower as the country’s manufacturing activity contracted at its fastest pace in 30 months in February. Gold prices fell, on a rise in the dollar while investors awaited U.S. economic data. Brent oil fell, as concern about a global economic slowdown prompted investors to take profits on the previous day’s gains, outweighing supply curbs.
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.
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