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SECTOR COMMENTARY:
The energy sector is set for a higher start, supported by strength in the crude complex. The major market futures are flat but in negative territory as investors continue to digest new global economic data as we approach the end of the year.
WTI and Brent crude oil are trading higher this morning on a softer dollar and as the U.S. plans to restock petroleum reserves. Oil futures gained after the U.S announced plans to buy up to 3 million barrels of oil for the Strategic Petroleum Reserves after this year’s record release. 180 million barrels of oil were released from the SPR in an attempt to lower the price of fuel for the American public. Additionally, the Bank of Japan decided to review its yield curve control policy and widen the trading band for the 10-year government bond yield which sent the Yen climbing against the dollar. However, rising COVID-19 cases in China limited gains as investors fear the top oil importer may reimpose restrictions that can dent their plans for growth.
Natural gas futures dropped amid forecasts for much warmer weather for the last few days of December and into the new year.
BY SECTOR:
US INTEGRATEDS
Bloomberg reported that Exxon Mobil is avoiding hiring oil tankers that previously carried cargoes from Russia, putting itself in the same camp as Shell Plc with a move that pressures owners to choose whether to serve Moscow’s interests or not.
Italian fuel and mobility group IP said it signed a deal to buy several refinery and fuel assets owned by Exxon Mobil’s subsidiary ESSO Italiana. Under the deal, IP will acquire the 75% of a refinery based in Trecate, near Turin, it does not already owns and several other assets in Genoa and Naples, the Italian group said in a statement.
INTERNATIONAL INTEGRATEDS
BP announced that on 22 December 2022 it will issue and allot 54,999,996 ordinary shares with a par value of US$0.25 each in connection with distributions to participants in certain of its employee share schemes. The issuance of the new Shares is subject to an application for the admission of those shares to the Official List of the Financial Conduct Authority and to trading on the main market for listed securities of the London Stock Exchange plc. It is expected that Admission will occur on 22 December 2022.
Equinor and its partners in the Arctic Snoehvit gas field will invest 13.2 billion Norwegian crowns ($1.34 billion) to upgrade the Hammerfest liquefied natural gas plant, which processes the output, the government and companies said.
Petroleo Brasileiro SA has decided to terminate the process to sell fertilizer subsidiary Araucaria Nitrogenados, it said in a statement late on Monday. The announcement came after newspaper Valor Economico reported that Petrobras’ plans to sell the unit to Norway’s Yara would not materialize.
CANADIAN INTEGRATEDS
Imperial Oil provided an update on its corporate guidance outlook for 2023. Capital spending is forecast at $1.7 billion and includes a planned ramp-up for the Strathcona Renewable Diesel project, application of solvent technologies at Cold Lake and ongoing investment on the in-pit tailings project at the Kearl oil sands facility. In the Upstream, production is forecast between 410,000 and 430,000 gross oil equivalent barrels per day, reflecting the sale of the company’s interests in XTO Energy Canada. In the Downstream, throughput is forecast to be between 395,000 and 405,000 barrels per day with capacity utilization between 92% and 94%, reflecting an increase in planned turnaround activity at the company’s Strathcona and Sarnia refineries in 2023.
U.S. E&PS
Enerplus announced that it has closed the previously announced sale of substantially all of its remaining Canadian assets to Surge Energy for total consideration of CDN$245 million, prior to closing adjustments.
CANADIAN E&PS
No significant news.
OILFIELD SERVICES
Halliburton announced it was named to the 2022 Dow Jones Sustainability Indices (DJSI), which recognize the top 10% most sustainable companies.
Shawcor announced that its pipe coating division, Pipeline Performance Group, has received several project commitments which, in aggregate, are valued over $200 million. These commitments include: A Letter of Intent from Saipem for a deep-water development project in South America. Two binding letters of intent and two purchase orders for the provision of insulation coating services on four Brazilian offshore projects. At the beginning of the month, Shawcor also completed the sale of its Socotherm Americas subsidiary in Argentina to Patagonia Shale Services.
TETRA Technologies announced updates on some of the Company’s strategic initiatives. TETRA announced that Hargrove has completed the Front-End Engineering Design scope of work for the development and construction of a bromine production facility from TETRA’s brine leases in Arkansas. Hargrove’s FEED study provided an estimated total required capital investment, within a relevant range, over an estimated 24 month-period to construct the facility; optimized process flow, and identified long lead items. In addition, also provided was an evaluation of the required capital and engineering design to maximize the project’s long-term profitability and the actions necessary to reduce execution risk to support the advancement of the project towards becoming a robust bromine-producing plant.
DRILLERS
No significant news.
REFINERS
Strike action at Valero’s 220,000 barrel per day (bpd) Pembroke oil refinery in Wales has caused delays to fuel distribution, two industry sources told Reuters.
MLPS & PIPELINES
TC Energy on Monday said its Keystone pipeline spill recovery rates have the potential to slow due to the upcoming cold weather in the area.
MARKET COMMENTARY
Wall Street futures struggled for direction and world stocks fell, as the Bank of Japan surprised investors by deciding to review its yield curve control policy and widen the trading band for the 10-year government bond yield. The yen surged against the dollar and gold climbed. Oil prices rose on softer dollar and a U.S. plan to restock petroleum reserves.
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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