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SECTOR COMMENTARY:
The energy sector is set for a higher start, tracking gains in the underlying commodities. U.S equities are mixed in pre-market trading as investors await key inflation data later this week. U.S. consumer price inflation figures for April will be released on Wednesday which will have an influence on the Fed’s stance towards future interest rate decisions.
WTI and Brent crude oil futures jumped this morning on easing recession concerns and as investors purchase energy contracts at a bargain following three-consecutive weeks of declines. Some traders believe the recent sell-off is over with Goldman Sachs analyst over the weekend saying that concerns over near-term demand and elevated supplies were “overblown”. Voluntary output cuts made by OPEC+ begin this month and the group holds its next meeting on June 4th. The market will be keeping an eye out for OPEC’s latest monthly oil market report which is due on Thursday, and will provide an updated reading on the demand and supply outlook.
Natural gas futures are starting the week higher on forecast for higher demand as the NOAA 6-10 day Sunday afternoon has TX, LA, NM and OK experiencing below-normal temperatures, KS and MI normal temps while everywhere else is seen above-normal. The 8-14 day has it warmer in the West and upper-Midwest, a mix of normal and above-normal temps on the East Coast while everywhere else is seen below-normal. Europe’s TTF is down (1.5%) to 36.02 euros per MWh.
BY SECTOR:
US INTEGRATEDS
No significant news.
INTERNATIONAL INTEGRATEDS
Equinor and its partners have decided to invest about $9 billion to develop the BM-C-33 gas and oil condensate discovery off Brazil, the Norwegian company.
CANADIAN INTEGRATEDS
No significant news.
U.S. E&PS
Crescent Point Energy advised that it has temporarily shut in its Kaybob Duvernay production in response to the recent Alberta wildfires. This precautionary measure is being taken by the Company to protect the safety of its staff, the community, environment, and its assets. As a result, approximately 45,000 boe/d of production in the Kaybob Duvernay has been temporarily shut-in with a plan to restart production once safe and permitted to do so. No damage has been reported to the Company’s assets.
CANADIAN E&PS
Vermilion Energy provided the following update on the impact of the wildfires in Alberta.
With the protection and safety of our people and local residents as the utmost priority, Vermilion is closely monitoring the wildfires surrounding our operations in West Central Alberta. We have accounted for all of our employees and contractors in the affected areas to ensure their safety, and have also taken the safe measure to temporarily shut-in approximately 30,000 boe/d of production while we assess the risk to our operations. Our assessment to date indicates minimal damage to our key infrastructure. Vermilion will continue to closely monitor the situation and work with the appropriate authorities, and we will provide an update in due course.
OILFIELD SERVICES
No significant news.
DRILLERS
No significant news.
REFINERS
Delek US Holdings announced financial results for its first quarter ended March 31, 2023. Net income of $64.3 million or $0.95 per share. Adjusted net income of $92.7 million or $1.37 per share. Adjusted net income of $92.7 million or $1.37 per share. Repurchased approximately $40.0 million of shares subsequent to quarter end; Increased the quarterly regular dividend by 4.5 percent in May 2023.
MLPS & PIPELINES
Delek Logistics Partners announced its financial results for the first quarter 2023, with reported net income attributable to all partners of $37.4 million, or $0.86 per diluted common limited partner unit. This compares to net income attributable to all partners of $39.5 million, or $0.91 per diluted common limited partner unit, in the first quarter 2022. Net cash provided in operating activities was $29.2 million in the first quarter 2023 compared to net cash provided by operating activities of $47.9 million in the first quarter 2022. Distributable cash flow was $61.8 million in the first quarter 2023, compared to $51.7 million in the first quarter 2022. For the first quarter 2023, earnings before interest, taxes, depreciation and amortization (“EBITDA”) was $93.2 million compared to $66.0 million in the first quarter 2022.
Enbridge announced the following executive leadership changes. The Enbridge Board of Directors has appointed Patrick Murray, currently Senior Vice President & Chief Accounting Officer, to succeed Vern Yu as Executive Vice President and Chief Financial Officer effective July 1, 2023. This appointment follows the decision by Mr. Yu, Executive Vice President, Corporate Development, Chief Financial Officer & President, New Energy Technologies to leave the Company on June 30, 2023 in conjunction with his appointment as President & CEO of AltaGas Ltd.
Jefferies downgraded FrontLine to Hold from Buy.
Overseas Shipholding Group reported results for the first quarter of 2023. Shipping revenues for the first quarter of 2023 were $113.8 million, an increase of $9.8 million from the first quarter of 2022. Net income for the first quarter of 2023 was $12.1 million, or $0.14 per diluted share, compared with a net loss of $509 thousand, or $(0.01) per diluted share, in the first quarter of 2022. First quarter 2023 Adjusted EBITDA(B), a non-GAAP measure, was $40.9 million, an increase of $15.5 million, or 61.0%, from the first quarter of 2022. In March 2023, our Board of Directors authorized a program to purchase up to $10.0 million of shares of our common stock. We purchased 498 thousand shares for $1.9 million through March 31.
MARKET COMMENTARY
U.S. stock index futures edged higher ahead of key inflation data expected in the week that would offer more cues on the Federal Reserve’s monetary policy path. European shares rose, with energy and bank stocks leading the way. In Asian equities, Japanese shares ended lower as investors sold stocks as the yen strengthened against the dollar and concerns over the U.S. banking sector persisted. Oil prices rose as U.S. recession fears fade. Gold prices ticked up as the dollar eased.
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.
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