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SECTOR COMMENTARY:
The energy sector is set for a lower start, pressured by weakness in the underlying commodities and the broader markets. The major averages are expected to start the week in negative territory as investors brace themselves for expected rate hikes from major central banks and earnings from several high-profile companies.
WTI and Brent crude oil are trading lower on looming interest rate hikes from central banks around the world and strong Russian exports. U.S. investors expect the Federal Reserve to increase interest rates by 25 basis points on Wednesday, followed by 50 basis point increases from the Bank of England and the European Central Bank. Additionally, the markets were shocked amid indications of strong Russian supply, despite sanctions against the country over its invasion of Ukraine. Lastly, key ministers from OPEC+ are set to meet on Wednesday to agree on any changes surrounding oil output policy.
Natural gas futures are down on forecasts for warmer-than-normal weather in key consuming regions and on-going concerns over the restart of the Freeport LNG export plant.
BY SECTOR:
US INTEGRATEDS
The White House launched a fresh attack against U.S. oil companies, accusing them of using profits to pay shareholders instead of boosting supply, after Chevron said its annual profit doubled for 2022.
Exxon Mobil disclosed its plan to start operations at its large-scale hydrogen plant in Texas in 2027 or 2028, Exxon’s Low Carbon business president Dan Ammann told Reuters.
INTERNATIONAL INTEGRATEDS
CNTXT, a leading provider of cloud and digital transformation solutions in Saudi Arabia, has signed a Digital Master Digital Service Agreement with the global industry leader, Saudi Aramco.
Eni and Libya’s National Oil Corporation (NOC) have signed an $8 billion gas production deal, Eni’s chief executive Claudio Descalzi said on Saturday.
Shell will combine its oil and gas production and liquefied natural gas (LNG) divisions as part of broader changes under new CEO Wael Sawan, which the company said could result in some job cuts.
Shell Plc said its integrated gas and upstream businesses would be combined to form a new integrated gas and upstream directorate led by current upstream director Zoe Yujnovich.
Shell plc is to reduce the size of its Executive Committee (EC) from nine to seven members in a decisive move designed to simplify the organisation further and improve performance as we deliver our Powering Progress strategy.
TotalEnergies and Eni have completed the transfer to QatarEnergy of a 30% interest in exploration Blocks 4 and 9 off the coast of Lebanon.
TotalEnergies is keen to start work on Lebanon’s offshore block 9 “as soon as possible” with well drilling to begin in the third quarter of 2023, its CEO Patrick Pouyanne said on Sunday.
CANADIAN INTEGRATEDS
No significant news.
U.S. E&PS
Goldman Sachs downgraded Hess to Neutral from Buy.
W&T Offshore announced the closing of its previously announced offering of $275 million in aggregate principal amount of 11.75% Senior Second Lien Notes due 2026 at par in a private offering that is exempt from registration under the Securities Act of 1933, as amended.
CANADIAN E&PS
No significant news.
OILFIELD SERVICES
Baker Hughes announced a memorandum of understanding (MoU) with Fortescue Future Industries (FFI) to jointly explore potential opportunities for the scale up and adoption of novel technology solutions for green hydrogen, green ammonia and geothermal projects. The companies see new pathways to accelerate the energy transition thanks to their respective expertise and portfolio of technologies on new projects.
Baker Hughes announced at its Annual Meeting in Florence, Italy, the introduction of multiple new digital solutions and investments to advance more intelligent and energy-efficient operations. The result of detailed research conducted with oil and gas, heavy industry and broader industrial customers and partners, the solutions focus on improving efficiency and performance while reducing emissions, helping to drive the long-term sustainability of customer operations.
KBR announced the release of Asset Ikigai, an ISO 55001-certified, next generation asset management framework to help customers maximize the value they can realize from their physical asset portfolios.
DRILLERS
No significant news.
REFINERS
Marathon Petroleum announced that Toni Townes-Whitley has been elected to the company’s board of directors, effective March 1, 2023.
MLPS & PIPELINES
Frontline plc confirmed that it has received from Euronav NV an arbitration request for proceedings on the merits following Frontline’s decision to terminate the combination agreement as further explained in Frontline’s press release dated 9 January 2023. Frontline is currently analysing this request with its legal advisors. Frontline once again confirms that its decision to terminate the combination agreement was entirely lawful. The request for proceedings on the merits is in addition to Euronav’s earlier emergency arbitration request for urgent interim and conservatory measures as further explained in Frontline’s press release dated 18 January 2023.
MARKET COMMENTARY
Wall Street futures dipped as investors awaited guidance later in the week on the Federal Reserve’s policy and vital economic data. European shares fell as shares in technology sectors were caught among the major laggards. In Asian equities, Japan’s Nikkei ended at a more than one-month high, while Chinese stocks closed in the green as strong consumer spending and a rebound in travel during the country’s week-long Lunar New Year holidays boosted investor sentiment. Oil prices were little changed as signs of strong Russian exports balanced rising Middle East tension over a drone attack in Iran and hopes of higher Chinese demand. The dollar edged lower, while gold prices fell.
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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