Crude Drops on Weaker than Expected Factory Activity in China, Expanding COVID-19 Curbs
The energy sector is set for a lower start pressured by weakness in the crude complex and the major indices. U.S market futures are expected to open lower as investors brace themselves for the upcoming two-day Federal Reserve policy meeting where they are anticipating another larger interest rate hike.
WTI and Brent crude oil are down in early trading amid weaker than expected Chinese factory activity data and as China continues to expand its COVID-19 curbs. Factory activity in China fell in October, weighed down by lower global demand and COVID-19 restrictions. Additionally, several Chinese cities are also widening their COVID-19 curbs in an attempt to control a series of outbreaks. In an outlook released on Monday, OPEC+ is sticking to a view of oil demand rising for another decade despite increasing use of renewable energy.
Natural gas futures rallied this morning on forecasts for higher demand, high European gas prices and as the Cove Point LNG export plant ends maintenance.
BY SECTOR:
US INTEGRATEDS
Boston Energy Research downgraded Chevron to Sell from Buy.
Exxon Mobil signed an 11-year agreement extending the sale of Mobil quality fuels at 7-Eleven Australia’s convenience stores until 2033.
Reuters reported that Exxon Mobil plans to restart the lube oil Blending & Packaging (B&P) Plant adjoining its Beaumont, Texas, refinery following an unplanned shutdown.
A contractor at Exxon Mobil's lube oil Blending & Packaging Plant in Beaumont, Texas, was killed in a rail car accident at the facility, the Jefferson County Sheriff's Office said.
INTERNATIONAL INTEGRATEDS
Libya has agreed with Eni and BP to begin extracting natural gas from a Mediterranean gas field believed to be bigger than Egypt's huge Zohr field, the head of the National Oil Company (NOC) told Skynews Arabia.
Eni and the University of Pisa signed a joint research agreement (JRA) that will consolidate their partnership and extend their collaboration to other topics of common interest, in which the University of Pisa has recognised excellence. These include metallurgy, new applications of ionic liquids, aerial and submarine robotics, biofuels, information technology and new additives for lubricants.
Eni said that the board resolved the distribution of the second tranche of dividend of 2022 for 0.22 euro per share.
The Petroleum Safety Authority Norway (PSA) has followed up an order issued after a previous major accident audit, and followed up incidents at Tjeldbergodden. The objective of the audit was to follow up Equinor's handling of an order issued on 25 January 2021 subsequent to an audit of materials handling, cranes and lifting in October 2020.
Through its Deep Tech fund, Repsol has acquired 33% of the technology company Smarkia, a software-as-a-service platform that provides its customers with energy optimization solutions. For its part, the US renewable energy company MN8 Energy has acquired 37% of the startup. In the same operation, Repsol has transferred one of its energy optimization technologies to Smarkia, which will be in charge of its commercialization.
Petrobras found oil at Sepia oilfield after drilling the 4-BRSA-1386D-RJS well.
German-listed shares in Brazil's state-run oil company Petrobras slipped more than 7% in early European trade after leftist leader Luiz Inacio Lula da Silva narrowly defeated President Jair Bolsonaro in a runoff election.
Petrobras informed that the drill-stem test in the wildcat well 1-BRSA-1381-SPS (Curaçao), located in the Pre-salt section in the southwestern portion of the Santos Basin, has been successfully completed. The discovery in the Aram Block is located 240 km from the city of Santos, State of São Paulo, under a water depth of 1905 m. The drill-stem test (DST) investigated a thick interval of petroleum-bearing Pre-salt carbonates, whose productivity was evaluated by dynamic production data. Oil samples were collected during the DST to be further characterized by laboratory analyses. This DST operation performed around 6 months after the conclusion of the wildcat well 1-BRSA-1381-SPS in January 2022 complements its evaluation undertaken previously with logs.
Helix Energy Solutions Group announced a deepwater well decommissioning contract award by Shell Brasil Petroleo Ltda. (Shell Brasil). The project, located offshore Brazil in the Campos Basin, is expected to commence early 2024 for a minimum firm period of 12 months, plus customer options to extend.
QatarEnergy is in talks with the Lebanese government to take a 30% stake in an offshore exploration block and is also negotiating with TotalEnergies and Eni on this matter, CEO Saad al-Kaabi confirmed on Sunday.
TotalEnergies ENEOS has completed a 0.7 MWp solar photovoltaic (PV) rooftop installation for a world leader in gases, technologies and services for industry and health, to power the needs of its site in Singapore with renewable energy.
CANADIAN INTEGRATEDS
No significant news.
U.S. E&PS
Murphy Oil announced that it will redeem $200 million in aggregate principal amount of its 5.750% Senior Notes due 2025 on November 30, 2022, the redemption date for the Notes.
QatarEnergy's chief executive on Sunday named ConocoPhillips as the third and final partner on the Gulf Arab state's North Field South expansion, part of the world's largest liquefied natural gas (LNG) project.
CANADIAN E&PS
No significant news.
OILFIELD SERVICES
Halliburton announced new products that highlight innovative technologies and sustainable solutions as part of its presence at the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC). Collectively, the new technologies promote more precise and efficient drilling performance, remote automation for enhanced safety, and a reduced carbon footprint for cementing activities.
KBR announced the launch of its mega 10,000 MTPD blue and green ammonia offering to help meet the growing global sustainable energy and fertilizer demands of today and the future.
NOV launched premium Pegasus series drill bits for large-diameter applications.
SLB and Linde announced that they have entered into a strategic collaboration on carbon capture, utilization and sequestration (CCUS) projects to accelerate decarbonization solutions across industrial and energy sectors. The collaboration will combine decades of experience in carbon dioxide (CO2) capture and sequestration; innovative technology portfolios; project development and execution expertise; and engineering, procurement, and construction (EPC) capabilities.
DRILLERS
No significant news.
REFINERS
No significant news.
MLPS & PIPELINES
Brooge Energy announced that it has engaged Grant Thornton Financial Advisors LLC, a subsidiary of Grant Thornton LLP, as an independent financial advisor to provide an opinion to the special committee of the Board of Directors as to the fairness from a financial point of view of the consideration to be received by shareholders unaffiliated with the Company’s majority shareholder with respect to its majority shareholder’s, BPGIC Holdings Limited, proposal to acquire all the shares of the Company it does not currently own and to take the Company private.
MARKET COMMENTARY
U.S. stock index futures fell, as Treasury yields edged up with investors wary about prospects of the Federal Reserve toning down its hawkish stance on inflation as they brace for another jumbo-sized interest rate hike this week. The U.S. dollar edged higher, while gold took a beating. European shares fell, as data showed euro zone inflation hit a record high in October. Hong Kong shares posted their biggest monthly loss in 14 years and oil prices slid, as weak factory activity data and fresh COVID outbreaks compounded China growth fears.
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.
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