Tue, Feb. 3, 2:49 PM
- Veteran energy analyst Christopher Eades recommends a half-dozen safe oil majors, oilfield services firms and transport MLPs as the best bets to ride out the current storm - Halliburton (HAL +4%), Pioneer Natural Resources (PXD +2.2%), Hess (HES +3.2%), Occidental Petroleum (OXY +2.1%), Enterprise Products Partners (EPD +1.4%) and Plains All American Pipeline (PAA +2.4%) - all companies with strong balance sheets, strong growth prospects, and healthy yield levels with no dividend cuts on the table.
- Eades says he is "more enthusiastic about MLPs than I've been in some time," as the group has essentially given up two years’ worth of gains yet cash flow fundamentals have been largely unchanged - "to me, that sounds like a good opportunity, particularly in a world still so starved for yield."
Mon, Jan. 5, 12:18 PM
- Energy stocks severely underperform the broader market, with the sector -4.2% vs. the S&P 500's -1.4%, as U.S. oil prices briefly slip below $50/bbl for the first time since April 2009; Nymex crude recently was -4.4% at $50.37, while Brent crude -5.9% at $53.08.
- Among the day's biggest losers: DNR -9%, RIG -7.6%, NBR -4.8%, CHK -5.9%, SDRL -9.1%, SD -12.3%, NOV -5.9%, PSX -6.2%, APA -5.9%, DVN -4.4%, EOG -6%, SU -5.2%, OXY -4.2%, APC -8.7%, PWE -9%, ECA -5.5%, MRO -5.3%.
- Global oil majors, which have been seen as less vulnerable to falling oil prices, are posting big losses: XOM -2.7%, COP -4.5%, CVX -3.8%, BP -5.8%, RDS.A -4.6%, TOT -6.5%.
- ETFs: USO, XLE, OIL, UCO, ERX, VDE, OIH, SCO, XOP, ERY, FCG, DIG, PBW, BNO, GASL, DTO, DBO, DUG, IYE, XES, IEO, QCLN, IEZ, UWTI, PXE, USL, PXI, FENY, DWTI, PXJ, DNO, PSCE, RYE, SZO, PUW, FXN, OLO, DDG, HECO, TWTI, OLEM
Dec. 22, 2014, 10:45 AM
- Natural gas prices fall 9.5% to near two-year lows at $3.133/mmBtu, in the biggest one-day percentage loss since February and the lowest intraday price since January 2013, on mild weather forecasts and inventory that is above year-ago levels.
- Prices are now down more than 15% in three straight losing sessions and are 30% lower than the six-month high closing price of $4.489/mmBtu it hit just a month ago.
- Weather has been unseasonably warm for December, limiting demand for home heating and allowing relatively low stockpiles to catch up to where they were a year ago and encouraging traders to sell based on the belief that supply is relatively healthy.
- Gas producers are among the biggest early decliners: XOM -1.1%, CHK -7.3%, APC -2.6%, SWN -6%, DVN -2.2%, COP -2.3%, BP -1.5%, COG -4%, BHP -1.9%, CVX -1.3%, ECA -5.1%, EQT -4.3%, RDS.A -1.7%, UPL -12%, WPX -6.9%, EOG -1%, OXY -1.1%, RRC -6.1%, APA -2.3%, AR -3.2%, CNX -3%, QEP -4.8%, LINE -4.9%, NBL -1.6%, SM -2.6%, XEC -4.2%, PXD -2.9%, NFX -5.1%.
- ETFs: UNG, DGAZ, UGAZ, BOIL, GAZ, FCG, GASL, KOLD, UNL, NAGS, DCNG
Dec. 3, 2014, 11:32 AM
- The energy sector (XLE +1.5%) continues its momentum from yesterday, leading the way again as the best performing sector in early trading with crude oil rising 1.2% so far today and reports that U.S. well permits fell 40% last month.
- Top performers include Clayton Williams (CWEI +7.7%), Transocean Partners (RIGP +10.6%), Gaslog (GLOG +13.8%) and Energy XXI (EXXI +15.7%).
- Other leading energy names are showing stronger recoveries as they clear last Friday's bearish gap zone: XOM +0.2%, CVX +0.4%, COP +2.5%, OXY +2.5%, DVN +2.9%, EOG +2.5%, HES +2.2%, MUR +1.5%, NBL +2.3%, PXD +4.2%, SU +3%, CNQ +1.9%.
- Some analysts warn that the worst may not be over, however, as much of the advance is being driven by investors repurchasing ETFs they used to make short bets; investors also could opt to sell oil shares at a loss in coming weeks to reduce tax burdens.
Dec. 1, 2014, 10:43 AM
- Occidental Petroleum (OXY -3.5%) is reiterated with Buy ratings but lower price targets at BofA Merrill and Jefferies after completing the spinout of 80% of the equity in California Resources Corp. (CRC -21.2%)
- BofA believes OXY has the defensive characteristics to complete its repositioning, starting with the CRC separation; implications for OXY start with removal of blackout restrictions to enable up to 15% of share buybacks and an accelerated pace of growth per share that remains competitive even at $70 oil.
- Meanwhile, the first day of trading for CRC is not going well: The stock recently traded at ~$7.25 for a market cap of $2.25B but analysts estimated when the spinoff was announced in February that it could be worth as much as $19B.
Nov. 28, 2014, 7:25 AM
- OPEC yesterday decided to hold production numbers despite the bear market in oil. WTI crude is down about $5 per barrel to $69.
- A premarket look at the top 10 holdings of the XLE: Exxon Mobil (NYSE:XOM) -4.1%, Chevron (NYSE:CVX) -4.1%, Schlumberger (NYSE:SLB) -4.6%, ConocoPhillips (NYSE:COP) -4.4%, EOG Resources (NYSE:EOG) -4.3%, Pioneer Natural Resources (NYSE:PXD) -4.8%, Occidental Petroleum (NYSE:OXY) -4.3%, Haliburton (NYSE:HAL) -4.7%, Anadarko Petroleum (NYSE:APC) -5%, Williams Companies (NYSE:WMB) -1.6%.
- ETFs: ERX, VDE, OIH, XOP, ERY, FCG, DIG, PBW, GASL, DUG, IYE, XES, IEO, QCLN, IEZ, PXE, PXI, FENY, PXJ, PSCE, RYE, PUW, FXN, DDG, HECO
Oct. 23, 2014, 8:17 AM
- Occidental Petroleum (NYSE:OXY) is flat premarket after its Q3 earnings report shows a 24% Y/Y drop in earnings and 7% lower revenues.
- In OXY's oil and gas business, core domestic earnings fell 32% to $538M, while earnings in its international unit edged up 0.8%; sales in the midstream and marketing segment fell 18%.
- Excluding the effect of the Hugoton sale, domestic oil production increased 20K bbl/day to 755K boe; domestic oil production was 282K bbl/day, a fifth consecutive quarterly record.
- Average realized prices for oil fell by 8.9% to $94.68 in the quarter.
Oct. 9, 2014, 3:25 PM
- Crushed by relentless anxiety about oversupply and weakening global demand, Nymex crude oil futures closed down $1.54 at $85.76/bbl, their lowest close since Dec. 2012, while Brent crude fell below $90/bbl for the first time in more than two years.
- Including today's losses, WTI crude is down 6.2% since the start of the month and Brent has surrendered ~5%.
- In the face of surging output, a move in WTI below its 10-year average at $82 is not out of the realm of possibility, Brown Brothers Harriman says, adding that "a break of $73/barrel could send WTI toward $64, which corresponds with the 2010 low."
- Among big oil names so far today: APC -6.3%, LINE -4.6%, EPD -3.8%, DVN -3.8%, MRO -3.6%, HES -3.8%, KMI -3.7%, TOT -3.5%, STO -3.3%, RDS.A -3.1%, OXY -3%, KMP -3%, XOM -2.6%, COP -2.6%, MUR -2.6%, CVX -2.5%, BP -2.4%.
- ETFs: USO, XLE, OIL, UCO, ERX, VDE, OIH, SCO, ERY, XOP, DIG, BNO, DTO, DBO, DUG, IYE, XES, IEO, CRUD, IEZ, PXE, USL, UWTI, PXJ, FENY, DNO, DWTI, RYE, FXN, SZO, OLO, DDG, OLEM, TWTI
Oct. 8, 2014, 10:44 AM
- Any sale of Occidental Petroleum's (OXY -1.7%) ~330K acres in North Dakota's Bakken shale formation would make strategic sense for the company, which may be eager to strike a deal, Raymond James analysts say.
- "This is substantially undeveloped acreage, and Occidental has long cited it as a likely monetization candidate, so it's been puzzling why the company kept it this long," the firm says.
- OXY currently ranks only no. 18 among North Dakota oil producers, with ~17K bbl/day and trailing peers of the same size and even much-smaller rivals.
Oct. 2, 2014, 4:49 PM
- Occidental Petroleum (NYSE:OXY) +1.8% AH after its board declared a quarterly dividend of $0.72/share, increased its share repurchase authorization by 60M shares to 76M, and authorized the spinoff of its California oil and gas business.
- The spinoff of the California Resources subsidiary will be achieved through the distribution of ~80% of the outstanding shares of California Resources to holders of OXY common stock; pretax income for the California business totaled $1.5B in 2013.
Mar. 20, 2014, 11:59 AM
- A unanimous vote from Carson, Calif., to impose a 45-day moratorium on new oil and gas drilling effectively stalls plans by Occidental Petroleum (OXY -3.5%) to develop ~200 new wells in the area.
- The city also voted to stop negotiations with OXY over proposed drilling plans until the company completes a planned spinoff of its California business.
- Two test wells in the area pulled enough oil from deep underground that OXY believes it can generate 6K bbl/day of oil and 3M cf/day of natural gas when peak production is reached.
Feb. 14, 2014, 7:35 AM
- Occidental Petroleum (OXY) +2% premarket on news it will spin off its California assets into a separately traded company, creating the state's largest natural gas producer.
- OXY says the new company will be the largest oil and gas mineral acreage holder in the state with ~2.3M net acres, and will have major operations in the states high-potential oil and gas basins, including Los Angeles, San Joaquin, Ventura and Sacramento.
Feb. 5, 2014, 9:55 AM
- NuStar Energy (NS +4.8%) signs a long-term agreement allowing Occidental Petroleum (OXY) to ship natural gas liquids on NuStar’s currently idled 200-mile pipeline between Mont Belvieu and Corpus Christi, Texas.
- NS has begun work to reactivate the line, reverse its flow and convert it from refined products service to NGL service; the pipeline has capacity to move ~110K bbl/day.
- The project is scheduled to be completed and in full operation in Q2 2015, although the pipeline may flow at reduced rates this year; once the line is in service, it is expected to generate ~$23M/year of incremental EBITDA for NS.
Nov. 4, 2013, 3:57 PM
- Occidental Petroleum (OXY +2.1%) is upgraded to Overweight from Equal Weight with a $108 price target, up from $93, at Barclays to reflect expected restructuring and increased optimism about drilling returns the firm expects accretive restructuring steps and improved drilling performance to lead to outperformance.
- Meanwhile, the firm downgrades Range Resources (RRC +1.4%) to Underweight with an unchanged $71 target, believing others are producing stronger value creation metrics, suggesting those companies may have greater returns on new drilling than RRC and thus should attract higher values for future drilling.
Aug. 30, 2013, 3:48 PM
- Apache (APA +9.2%) may have "knocked it out of the park" with its sale of a third of its Egypt oil and gas assets to Sinopec (SNP -1.2%) for $3.1B (I, II), but the reaction toward SNP is more ambiguous.
- The deal, China's biggest investment in the Middle East to date, shows a continued global search for energy and resources to feed an economy growing at a 7%-plus annual rate and a higher tolerance for risk than its western counterparts; note that PetroChina (PTR) reportedly is in talks to acquire 25% of Exxon's (XOM) West Qurna-1 oilfield in Iraq.
- The deal also could provide a boost for other energy producers with significant operations in the region; Occidental Petroleum (OXY -0.2%) produces ~37% of its total output in the Middle East and North Africa, and is thought to be looking to sell all or part of those assets.
Jul. 30, 2013, 3:49 PM
- Occidental Petroleum (OXY -2.3%) offered extensive details on its California operations during its earnings call, feeding speculation it may spin off that unit, which regularly faces tougher government scrutiny than elsewhere.
- "We want to make sure that the California company has stable, solid cash flow going forward," CEO Steve Chazen says.
- Expects H2 U.S. oil production of 6K-8K bbl/day higher than H1 average; sees Q2's "modest declines" in domestic gas and NGLs production to continue due to reduced drilling on gas properties and natural decline. (slides)
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