Oil Lower as Concerns of Further Interest Rate Hikes and Slowing Demand Curb Earlier Gains
SECTOR COMMENTARY:
The energy sector is set for a lower start, pressured by weakness in the crude complex and the broader markets. The major market futures are lower as investors await comments from Federal Reserve Chair Jerome Powell.
WTI and Brent crude oil futures are lower as concerns over the prospect of higher interest rates and slowing demand curb earlier gains. Lingering worries about tighter monetary policy outweighed the API’s weekly report which showed a larger-than-expected drop in crude oil inventories. The industry report showed crude stocks fell by 2.4 million barrels last week. The market will be keeping eyes on today's EIA report which is set to be released at 10:30AM EST.
Natural gas futures are higher, ahead of the expiration of the front month July contract. Early-cycle data has LNG feedgas flows today rising to 12.60 Bcf, up +1.0 Bcf d/d as Sabine Pass volumes recover further to over 4.0 Bcf. The increase would be the highest since the end of May.
BY SECTOR:
US INTEGRATEDS
No significant news.
INTERNATIONAL INTEGRATEDS
BP invested €7.5m in EV charging service provider service4charger as part of a €10 m series a funding round.
Eni Sustainable Mobility Spa and PBF Energy announced the closing of a 50-50 joint venture partnership in St. Bernard Renewables LLC (SBR), an operating biorefinery co-located with PBF's Chalmette Refinery in Louisiana (US). PBF's affiliate contributed the biorefinery and other assets comprising the business to SBR and Eni Sustainable Mobility's affiliate has committed to make capital reimbursements and contributions totaling $835 million to PBF, of which $431 million was paid at closing. The remainder of the total consideration will be contributed by Eni Sustainable Mobility upon start-up of the pre-treatment unit. An additional $50 million in contingent consideration will be paid by Eni Sustainable Mobility subject to the achievement of certain project milestones and performance criteria.
Toyota Tsusho to construct, own, operate solar power plant in Saudi Arabia with TotalEnergies, Altaaqa.
TotalEnergies announced that it will invest up to Eur 70 mln in La Mède Biorefinery.
CANADIAN INTEGRATEDS
No significant news.
U.S. E&PS
Gerdes Energy downgraded California Resources to Neutral from Buy.
Earthstone Energy announced that its subsidiary, Earthstone Energy Holdings, LLC has priced the previously announced private offering of $500 million aggregate principal amount of 9.875% senior unsecured notes due 2031. The Notes will be issued at a price of 97.968% of their principal amount.
CANADIAN E&PS
No significant news.
OILFIELD SERVICES
KBR announced it is a subcontractor to McCallie Associates, Inc., a certified small business selected to provide mission and instrument systems engineering services at NASA's Goddard Space Flight Center (GSFC) in Maryland and Wallops Flight Facility in Virginia.
DRILLERS
No significant news.
REFINERS
No significant news.
MLPS & PIPELINES
Citi downgraded Delek Logistics Partners to Sell from Neutral.
ONEOK and Magellan Midstream Partners announced the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the "HSR Act"), in connection with ONEOK's pending acquisition of Magellan.
MARKET COMMENTARY
Futures for the Nasdaq and the S&P 500 fell, dragged down by chip stocks, while investors awaited comments from Federal Reserve Chair Jerome Powell to gauge the path for interest rates. European stocks rose on robust US data, soothing concerns of a steep economic slowdown. Japan's Nikkei surged after four sessions of losses, as technology sector stocks climbed tracking U.S. peers. Oil rallied as US inventory drop offset rate hike jitters. The Dollar index was up, 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 Rich Pontillo.
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