Stock Futures – Crude Oil Futures Continue Yesterday’s Momentum Supported by Rising Fuel Demand Expectations
The energy sector is poised for a mixed to higher start, backed by strength across the underlying commodities but pressured by weakness in the major equity futures which fell on a mixed batch of earnings from big tech and ahead of the Fed’s policy statement later today. Investors are expecting the central bank will stick to its promise of keeping monetary policy loose.
WTI and Brent crude oil futures continued to build on yesterday’s momentum, supported by further expectations of rising fuel demand which offset concerns about the impact of a surge in India’s coronavirus cases and higher U.S. crude inventories. After OPEC+’s statement yesterday to stick to plans for a phased easing of oil production restrictions underscored the group’s confidence in a recovery in global demand, Goldman Sachs today said it expects “the biggest jump in oil demand ever, a 5.2 million bpd rise over the next six months” as vaccination campaigns accelerate in Europe and demand for travel climbs. Ahead of the official EIA data later today, last night’s API report showed a bigger than expected build in crude stockpiles last week while gasoline and distillate inventories fell.
Natural gas futures extended their swing higher, supported by record exports and declining production and despite warming weather forecast.
No significant news.
BP announced that it is to commence a share buyback programme to repurchase ordinary shares in the capital of the Company. The maximum amount allocated to the Programme is around $500 million for a period up to and including 30 June 2021.
According to Reuters, Petrobras produced 2.196 million barrels of oil per day in the first quarter, the state-run oil company said in a Tuesday securities filing. That represented a decline of 5.3% from the same period a year before.
According to Reuters, Saudi Arabia’s crown prince said in televised remarks on Tuesday that the kingdom was in discussions to sell another 1% of state oil firm Saudi Aramco to a foreign investor. Crown Prince Mohammed bin Salman said Aramco could sell shares to international investors within the next year or two.
According to Reuters, the UK’s Local Authority Pension Fund Forum said on Wednesday it recommended members oppose Royal Dutch Shell’s climate change strategy at the company’s forthcoming annual general meeting. Instead, the group, whose 82 members manage over 300 billion pounds ($416.61 billion) in assets, said it backed a resolution from activist group Follow This calling for the company’s targets to be aligned with the Paris Agreement on climate.
No significant news.
Evercore ISI upgraded Cimarex Energy to Outperform from In Line.
Evercore ISI upgraded Devon Energy to Outperform from In Line.
Hess Corporation reported net income of $252 million, or $0.82 per common share, in the first quarter of 2021, compared with a net loss of $2,433 million, or $8.00 per common share, in the first quarter of 2020 that included impairment and other after-tax charges of $2,251 million. On an adjusted basis, the net loss in the first quarter of 2020 was $182 million, or $0.60 per common share. In addition, Net production, excluding Libya, is now forecast to be 290,000 boepd to 295,000 boepd from previous guidance of approximately 310,000 boepd, reflecting a 7,000 boepd reduction in expected NGL volumes received as consideration from POP contracts for gas processing fees due to higher NGL prices which improve financial results, a reduction of 6,000 boepd from asset sales, and the balance primarily from adverse winter weather in North Dakota.
No significant news.
CGG announced the delivery of the fast-track data from its Agata Reimaging program over the Agata block in the Santos Basin, a highly prolific area of Brazil’s offshore pre-salt. The ultramodern reimaged seismic data set covering over 9,300 sq km will provide valuable information to oil and gas companies wishing to evaluate acreage and assess the potential of the Agata block, prior to Brazil’s upcoming 7th Production Sharing Bidding Round.
NOV reported first quarter 2021 revenues of $1.25 billion, a decrease of six percent compared to the fourth quarter of 2020 and a decrease of 34 percent compared to the first quarter of 2020. Net loss for the first quarter of 2021 was $115 million, or 9.2 percent of sales, which included non-cash, pre-tax charges of $9 million. Adjusted EBITDA decreased $17 million sequentially to $0.
Secure Energy Services reported its operational and financial results for the three months ended March 31, 2021, highlighted by Adjusted EBITDAi of $39.2 million. It recorded a net loss of $1.1 million, compared to a net loss of $22.4 million for the three months ended March 31, 2020. Revenue was $661.2 million for the three months ended March 31, 2021. In addition, the company declared dividends of $1.2 million, representing $0.0075 (0.75 cents) per common share for the quarter.
TechnipFMC reported first quarter 2021 results. Total Company revenue in the first quarter was $1,632 million. Income from continuing operations attributable to TechnipFMC plc was $430.3 million, or $0.95 per diluted share. These results included income from the Company’s equity investment in Technip Energies of $470.1 million primarily related to a favorable change in fair market value. After-tax charges and credits totaled $444.8 million of credit, or $0.99 per diluted share. Adjusted loss from continuing operations was $14.5 million, or $0.03 per diluted share.
RPC announced its unaudited results for the first quarter ended March 31, 2021. For the quarter ended March 31, 2021, RPC generated revenues of $182.6 million, a decrease of 25.1 percent compared to $243.8 million in the first quarter of 2020. Operating loss for the first quarter of 2021 was $10.5 million compared to an operating loss of $218.7 million and an adjusted operating loss of $13.2 million in the first quarter of the prior year. Net loss for the first quarter of 2021 was $9.7 million, or $0.05 loss per share, compared to a net loss of $160.4 million, or $0.76 loss per share in first quarter of the prior year. In the first quarter of 2020 the adjusted net loss was $9.0 million, or $0.04 adjusted loss per share.
No significant news.
MLPS & PIPELINES
Capital One Securities downgraded Crestwood Equity Partners to Equal weight from Overweight.
Enbridge, Walker Industries and Comcor Environmental, announced a partnership to jointly develop renewable natural gas (RNG) projects across Canada.
ONEOK announced higher first quarter 2021 results. Net income was $386.2 million, resulting in 86 cents per diluted share and first quarter 2021 adjusted EBITDA was $866.4 million, a 24% increase compared with first quarter 2020. In addition, the company increased 2021 financial guidance. Net income midpoint increase to $1.35 billion and diluted earnings per common share midpoint increase to $3.02.
SunCoke Energy reported results for the first quarter 2021, reflecting the strong performance in both the Domestic Coke and Logistics segments. First quarter 2021 net income attributable to SXC was $16.5 million, or $0.20 per share. Adjusted EBITDA for the quarter was $70.6 million, up 14 percent, versus the prior year period and represents record first quarter performance. In addition, domestic Coke total production is expected to be approximately 4.1 million tons and consolidated adjusted EBITDA is expected to be $215 million to $230 million.
SunCoke Energy announced that its Board of Directors declared a cash dividend of $0.06 per share of the Company’s common stock to be paid June 1, 2021 to stockholders of record at the close of business on May 19, 2021.
U.S. stock index futures were subdued ahead of the Federal Reserve’s policy decision as investors look out for further cues on how the central bank will respond to increasing signs of economic recovery. Investors also await quarterly results from Apple, Facebook and Ford, which are expected after the closing bell. European shares were mostly higher, buoyed by strong results from Deutsche Bank and Lloyds Banking Group. Asian equities ended in the green. The dollar rebounded as U.S. Treasury yields rose, while gold prices were in the negative territory. Oil prices gained on forecasts of recovery in global fuel demand.
NASDAQ ENERGY TEAM THOUGHT LEADERSHIP
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