Oil Up as Market Participants Keep a Close Eye on the Middle East
SECTOR COMMENTARY:
The energy sector is set for a higher start, supported by strength in the crude complex and the major market futures which are up as investors wait for more third quarter results.
WTI and Brent crude oil futures are kicking-off the week in positive territory as market participants keep a close eye on the conflict in the Middle East to see if it escalates further. Israeli air strikes on Gaza intensified on Monday, after diplomatic efforts to arrange a ceasefire in southern Gaza to allow foreign passport holders to leave failed. Elsewhere, the United States last week imposed the first sanction on owners of tankers carrying Russian oil prices above the G7’s price cap of $60 a barrel. This afternoon the EIA will release its Drilling Productivity Report which will include updated shale oil production estimates for October and November.
Natural gas futures are trading lower on milder than normal weather and on estimates for a weekly storage build of 88 Bcf to 92 Bcf vs the 5-yr average of 85 Bcf.
BY SECTOR:
US INTEGRATEDS
A Kazakh court has not upheld the $5 billion lawsuit by the country's ecology ministry's against the operator of the giant Kashagan oilfield, but the ministry has appealed, minister Yerlan Nysanbayev said. The ministry sued the group which includes Shell, Eni, TotalEnergies and Exxon Mobil, in March over what it said were excessive deposits of sulphur and other environmental issues.
INTERNATIONAL INTEGRATEDS
BP produced 13.5 million tonnes of oil in Azerbaijan in January-September 2023, Azerbaijan's Energy Ministry said. BP produced 12.1 million tonnes of oil between January and August, the Energy Ministry said in September.
CANADIAN INTEGRATEDS
No significant news.
U.S. E&PS
BMO downgraded Pioneer Natural Resources to Market Perform from Outperform.
CANADIAN E&PS
Tourmaline Oil announced that it has entered into a definitive share purchase agreement with all of the shareholders of Bonavista Energy Corporation ("Bonavista") to acquire all of the shares of Bonavista for $1.45 billion, consisting of $725 million in Tourmaline common shares and $725 million of cash, less Bonavista's net debt(1)(2) at closing. The Acquisition is expected to close in the second half of November 2023, subject to customary regulatory and stock exchange approvals.
OILFIELD SERVICES
No significant news.
DRILLERS
BOFA Global Research upgraded Patterson-Uti Energy to Buy.
REFINERS
Vertex Energy announced that it has formally named BofA Securities, Inc. (“BofA”) as Vertex’s strategic financial advisor to assist with the Company's renewable fuels and sustainable products growth strategy.
MLPS & PIPELINES
No significant news.
MARKET COMMENTARY
Wall Street futures edged up ahead of this week's corporate earnings and economic data that could offer clues on the state of the U.S. economy. European shares climbed, with miners in the lead on optimism around demand from top consumer China, even as prospects of an escalation in the Middle East conflict weighed on sentiment. Japan's Nikkei dragged lower, weighed down by chip-related shares. The dollar weakened against a basket of currencies, but remained near a one-week high on safe-haven bid. Gold prices fell on technical selling after a strong rally in the previous session. Oil prices were little changed, with market participants assessing the Israel-Hamas war.
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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Nasdaq Advisory Services Energy Team is part of Nasdaq's Advisory Services. 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.
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