December 17, 2019 /06:37 PM / By Tom Kool of
Oilprice.com / Header Image Credit: Kazakhtv
we will take a quick look at some of the critical figures and data in the
energy markets this week.
We will then look at some of the key market movers early this week before
providing you with the latest analysis of the top news events taking place in
the global energy complex over the past few days. We hope you enjoy.
- Employment in the U.S. coal mining industry declined from 92,000 in
2011 to just 54,000 in 2018. The largest declines were concentrated in
- In 2008, the U.S. produced 1.2 billion tons of coal from
1,458 mines. In 2018, those figures fell to 756 million tons from 679 mines.
- Appalachian mines tend to be smaller and more
- ConocoPhillips (NYSE: COP) saw
its outlook upgraded to Overweight by Atlantic Equities. The firm said that COP
has a 20 percent upside potential, with a price target of $75 per share.
- Tallgrass Energy (NYSE: TGE)
surged by 21 percent in early trading on Tuesday after it accepted an offer
from Blackstone Infrastructure Partners to acquire shares in the company. The
deal values the company at $6.3 billion.
- Transocean (NYSE: RIG) saw its
share price jump after it announced a one-year contract for one of its
drillships in Trinidad and Tobago.
December 17, 2019
Oil has edged up to three-month highs and is holding firm. "The conditions for
a rising oil price appear favorable at present," Commerzbank said in Tuesday. "Economic optimism coupled with a weaker US dollar and growing investor demand
have allowed Brent and WTI to climb to over $65 and to over $60 per barrel
respectively." However, the bank noted that the shine on the OPEC+ deal will
wear off, which creates downside risk.
skeptical of OPEC+ deal. Oil prices have hit three-month
highs on the back of the OPEC+ cuts and the thaw in the trade war, but the
rally has already slowed. Some analysts are skeptical that the lagging members
of the OPEC+ cohort, including Iraq and Nigeria, will live up to their
commitments. "Why would they change next year just because they made a pledge?" said Giovanni Staunovo, commodities analyst at UBS Global Wealth Management,
according to the Wall Street Journal.
and worst performing stocks of 2019. Who are some of the
best-performers and worst-performers of 2019? The "worst" list is riddled with energy names,
while the "best" list contains bad performers from 2018 who managed to stage a
gas study: Economic benefits, but larger health costs. A study from Carnegie Mellon
University found that Pennsylvania, Ohio and West Virginia enjoyed economic
benefits from the rise of shale gas, but the region also suffered premature
deaths due to pollution. The economic boost between 2004 and 2016 totaled $21
billion, but the costs reached $23 billion.
Permian still growing, contraction elsewhere. The EIA's Drilling Productivity Report
forecasts growth of 48,000 bpd in the Permian in January, compared to December.
However, output falls by 15,000 bpd in the Anadarko and by 9,000 bpd in the
Eagle Ford. On the gas side, output grows in the Permian, but contracts in the
Anadarko, Appalachia and Eagle Ford. The contraction in Appalachia is notable
since it is the largest source of gas in the country. But the basin has been
plagued by poor finances amid low prices.
Sachs bars new financing for coal and Arctic oil. Goldman
Sachs revised its policy to
exclude financing for projects based on coal or oil drilling in the Arctic. The
Wall Street giant also said that it would mobilize
$750 billion in financing for "climate transition and inclusive growth finance" over the next decade. The new policy is "now the strongest among the big six
U.S. banks," according to the Sierra Club and the Rainforest Action
emerges from bankruptcy. Weatherford International has emerged from Chapter 11
bankruptcy with $10 billion in financial support. Weatherford is currently
trading as a penny stock but has plans to return to the New York Stock
gas well a super emitter. Using satellites, scientists found that a shale gas
blowout at an XTO gas well, a subsidiary of ExxonMobil (NYSE: XOM),
emitted more methane into the atmosphere than some countries do in an entire year.
funds short "greenwashing" industries. Some hedge funds
sense a short-selling opportunity, identifying companies that have inflated
values because of unwarranted claims about sustainably. Investments defined as "sustainable" account for more than a quarter of all assets globally, according
to Reuters. "Greenwashing is absolutely rampant now," Chad Slater of Morphic
Asset Management told Reuters. "From the short
side, it's quite interesting."
Oil names to face shareholder pressure on climate. Activist
shareholder group Follow This is preparing more climate resolutions at
annual shareholder meetings next year. The majors have tried to beat back
rising shareholder activism, with mixed success to date, but the problem is not
makes large gas discovery off West Africa. BP (NYSE: BP)
found high quality natural
gas reservoirs off the coast of Senegal and Mauritania. The Orca-1 well is the
deepest and largest discovery made worldwide this year.
to pay $2.5 billion for Felix Energy. In a small sign that
the U.S. shale sector may be turning a corner, Oklahoma's WPX Energy decided to pay $2.5 billion
to buy privately-held Felix Energy, two names few outside of the industry would
have heard of. The deal could be interpreted as a sign the sector has bottomed
out, with bigger companies willing to shell out to buy up other companies and
assets. For much of this year, there has been little deal-making, and any
acquisition was panned by investors. But, WPX's stock was up after the news, an
indication that the markets have not entirely shunned the shale sector.
Sachs: Policy clarity to spur commodities demand. The
de-escalation in the trade war, the UK election, and the new NAFTA deal (the
USMCA) could "stimulate commodity demand" as they contribute to reduced
uncertainty, Goldman Sachs said in a note. "Most importantly, the Chinese have
agreed to purchase at least $40 billion of US agriculture goods in 2020," the
bank said. "However, the structural supply problems that have discouraged
investment in commodity production remain: poor company returns, too much debt
and environmental liabilities."
5 biggest threats to oil and gas in 2020. For oil and gas,
2019 turned out to be a busy year with weak demand and growing skepticism from
investors. But 2020 could offer even more unknowns, black swan events, and
derailed forecasts. There are 5 big factors to watch out
Prices Of PMS, AGO, HHK and Cooking Gas - November 2019
- The Oil
Bulls Are Back Despite Bearish Fundamentals - OIR 131219
- Oando Plc
Announces the Successful Signing of Two Gas Supply Agreements with NLNG
Launches Beneficial Ownership Portal
- OPEC Deal
And Trade War Pause Push Oil Up - OIR 101219
Shares Plummet 70% After Group Cuts Production Outlook
- Oil Jumps
On Saudi Surprise - OIR 061219
- How Much
Crude Oil Do You Unknowingly Eat?
- Oil Markets
Remain Hopeful Of OPEC Cuts - OIR 031219
- Oil Inches
Higher As OPEC Optimism Returns To Markets - OIR 261119
- IMO 2020
Fuel Sulphur Regulation Comes Into Effect From Jan 01, 2020
- Oil Bounces
Back On New Round Of OPEC Rumors - OIR 220919
- The Worst
Is Over For Oil Markets
- Oil Sinks
As Sentiment Turns Sour - OIR 190919
Prices Of PMS, AGO, HHK and Cooking Gas - October 2019