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SECTOR COMMENTARY:
The energy sector is set for a mixed start, pressured by weakness in the underlying commodities, but supported by mild support in the major market futures which steadied following yesterday’s fed driven selloff.
WTI and Brent crude oil are trading lower on concerns over more aggressive interest rate hikes following Chair Powell testimony yesterday. Investors are also looking to the weekly EIA report to gain further clarity on inventories after the API data showed a decline in crude inventories for the first time after 10-weeks of builds. Also dampening sentiment, Barclays lowered its 2023 Brent forecast by $6 to $92 a barrel and WTI by $7 to $87, “due primarily to more resilient-than-expected Russian supplies,” the bank said.
Natural gas futures are down as flows to the Freeport LNG export plant were on track to drop for the first time after the plant exited an eight-month outage last month. Gas flows to their plant were on track to reach just 0.1 bcfd on Wednesday, down from 1.0 bcfd on Tuesday.
BY SECTOR:
US INTEGRATEDS
Chevron New Energies, a division of Chevron, and JERA Co., Inc. (JERA) have signed a Memorandum of Understanding (MOU) that provides a framework for their collaboration on carbon capture and storage (CCS) projects located in the United States and Australia. This MOU has the potential to expand the significant liquid natural gas (LNG) relationship that Chevron and JERA have today, and further demonstrates the commitment and dedication both companies have to advancing lower carbon solutions.
INTERNATIONAL INTEGRATEDS
Eni has signed a two-year contract with Italy’s Spinelli to power the trucks of the logistic group with a diesel fuel produced from 100% renewable raw materials.
Petrobras will focus on financing large-scale renewable energy projects and evaluating new partnerships with energy companies in the coming years, its chief executive said in remarks released on Tuesday.
Deliveries from TotalEnergies refineries are suspended due to the strike triggered by the government’s planned pension reform, a company spokesperson said on Wednesday.
CANADIAN INTEGRATEDS
No significant news.
U.S. E&PS
W&T Offshore reported operational and financial results for the fourth quarter and full year 2022, including the Company’s year-end 2022 reserve report. Generated net income of $43.4 million or $0.30 per diluted share in the fourth quarter of 2022 and net income for the full year 2022 of $231.1 million or $1.59 per diluted share; Reported Adjusted Net Income of $15.2 million or $0.10 per diluted share in the fourth quarter of 2022, and Adjusted Net Income of $284.8 million or $1.96 per diluted share for the full year.
CANADIAN E&PS
MEG Energy announced that the Toronto Stock Exchange has approved the renewal of the Corporation’s normal course issuer bid.
OILFIELD SERVICES
ATB Capital Markets upgraded Enerflex to an Outperform from Sector Perform.
Granite has been selected by the City of Lancaster to lead an approximately $30 million contract for various improvements to the Avenue J (Ave J) Interchange at California State Route 14 (SR 14). The project will be funded by Caltrans, the City of Lancaster, and the Los Angeles County Metropolitan Transportation Authority (LA Metro) and be included in Granite’s first quarter CAP 2023.
DRILLERS
Nabors Industries, a wholly-owned subsidiary of Nabors Industries reported the completion of the redemption of approximately $210 million of 9% senior priority guaranteed notes due in 2025. The redemption was funded with proceeds from the Company’s recent issuance of $250 million of 1.75% exchangeable senior unsecured notes due 2029.
REFINERS
Marathon Petroleum announced the acquisition of a 49.9% interest in LF Bioenergy, an emerging producer of renewable natural gas (RNG) in the United States, from Cresta Fund Management for $50 million. The agreement includes the potential for up to an additional $50 million based on the achievement of predetermined earn-out targets.
MLPS & PIPELINES
JP Morgan started Scorpio Tankers with an Overweight rating.
The U.S. pipeline regulator issued an amended corrective action to TC Energy on Tuesday, requiring it to take new actions on more than 1,000 additional miles of its Keystone pipeline that spilled nearly 14,000 barrels of oil in rural Kansas in December.
MARKET COMMENTARY
U.S. stock index futures edged higher as investors digested hawkish comments from Federal Reserve Chair Jerome Powell that fueled a selloff on Wall Street a day earlier and put a sharp focus on the upcoming labor market data. European shares fell as the chemicals sector led declines on news of a Swiss antitrust probe into key fragrance companies. Japan’s Nikkei share average climbed to a 3-1/2-month high a weakening yen buoyed the outlook for exporters. Oil prices edged lower driven by fears that more aggressive U.S. interest rate hikes would hit demand, while the market awaited further clarity on inventories. The dollar edged higher and gold prices rose. Data for JOLTS job openings, ADP national employment, and trade balance is expected 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 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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