SECTOR COMMENTARY:

The energy sector is poised for a mixed to lower start, looking past strength in the crude complex and pressured by mild weakness in the major equity indices. U.S. stock index futures extended declines as a stronger-than-expected job report signaled labor market resilience, dampening hopes of interest rate cuts next year.

WTI and Brent crude oil futures are up over 2% in early trading despite worries about a supply surplus and weak Chinese demand, though prices rebounded after Saudi Arabia and Russia lobbied OPEC+ members to join output cuts. Saudi Arabia and Russia called for all OPEC+ members to join an agreement on output cuts for the good of the global economy, only days after a fractious meeting of the producers’ club. OPEC+ agreed to a combined 2.2 million bpd in output cuts for the first quarter of next year. Meanwhile, Chinese customs data showed its crude oil imports in November fell 9% from a year earlier as high inventory levels, weak economic indicators and slowing orders from independent refiners weakened demand.

Natural gas futures are trading slightly lower as the NOAA’s 6-10 day outlook shows above-normal temps for the West coast through the Great Plains to the Great Lakes as well as southern FL. Near-normal temps are seen across parts of southeastern NM, TX and along much of the eastern US.

BY SECTOR:

US INTEGRATEDS

On December 7, 2023, Chevron and Hess each received a request for additional information and documentary materials from the FTC in connection with the FTC’s review of the Merger. Issuance of the Second Request extends the waiting period imposed by the HSR Act until 30 days after Chevron and Hess have substantially complied with the Second Request, unless that period is extended voluntarily by Chevron and Hess or terminated sooner by the FTC. Both Chevron and Hess expect to promptly respond to the Second Request and to continue to work cooperatively with the FTC in its review of the Merger.

INTERNATIONAL INTEGRATEDS 

No significant news.

CANADIAN INTEGRATEDS

No significant news.

U.S. E&PS

Permian Resources announced that Permian Resources Operating, LLC (the “Issuer”), a subsidiary of Permian Resources, has priced its previously announced private placement pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as amended, to eligible purchasers of $500.0 million aggregate principal amount of 7.000% senior notes due 2032. The Notes mature on January 15, 2032 and pay interest at the rate of 7.000% per year, payable on January 15 and July 15 of each year. The first interest payment on the Notes will be made on January 15, 2024. The Notes were priced at 99.50% of par, plus accrued and unpaid interest from September 12, 2023. The Notes will be guaranteed on a senior unsecured basis by Permian Resources and all of the Issuer’s subsidiaries that guarantee the Issuer’s obligations under its senior secured credit facility. The Issuer intends to use the net proceeds from this offering to repay all or a portion of the amounts outstanding under its credit facility and any remaining net proceeds for general corporate purposes. The Notes Offering is expected to close on December 13, 2023, subject to customary conditions.

BoFA Global Research initiated coverage of Vital Energy with Underperform rating and a $48 price objective .

CANADIAN E&PS

No significant news.

OILFIELD SERVICES

JP Morgan upgraded NOV to Overweight from Neutral.

DRILLERS

No significant news.

REFINERS

Marathon Petroleum returned a crude distillation unit (CDU) to normal operation on Wednesday at its 593,000 barrel-per-day (bpd) Galveston Bay Refinery in Texas City, Texas, people familiar with plant operations said. The 225,000-bpd Pipestill 3B CDU malfunctioned on Tuesday night into Wednesday morning, according to a notice filed with the Texas Commission on Environmental Quality by Marathon.

MLPS & PIPELINES

No significant news.

MARKET COMMENTARY

Wall Street futures were subdued as investors prepared for the crucial monthly payrolls report, due later in the day, to gain more insight into the Federal Reserve’s stance on monetary policy for the upcoming year. Meanwhile, European shares were in the green, driven by gains in luxury and energy stocks, with investors assessing Germany’s inflation data. Japan’s Nikkei recorded its worst weekly decline since mid-September, driven by increased speculation about an imminent end to the Bank of Japan’s decade old stimulus measures. Gold prices were flat as the dollar gained ground. Oil prices were higher after Saudi Arabia and Russia called for more OPEC+ members to join output cuts.


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.


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. 

Source: Nasdaq

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