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Oil & Gas Atlas
Energy large caps near 52-week highs
Energy Market Indices WoW Changes
⇒ S&P/TSX Energy Index: +2.0%
⇒ S&P 500 E&P Index: -1.0%
⇒ Oil Service Sector Index: +1.1%
⇒ UK FTSE Oil & Gas Producers Index: +0.1%
⇒ Asia Pacific Oil & Gas Producers Index: +2.7%
Weekly Market Recap
April WTI crude oil futures traded into the triple-digits last week and closed above
US$104/bbl on Friday, up 7% WoW. Unrest in the MENA region renewed concerns over
supply disruptions and pushed Brent prices to US$116/bbl, a US$12/bbl premium to WTI.
The DOE reported bullish inventory draws across the board, while Cushing levels gained
1.1mmbbl to a record high of 38.57mmbbl.
Henry Hub gas fell for three days straight before recovering slightly to US$3.81/mmbtu
on Friday. High snow pack and the outlook for above-normal rainfall in the US Pacific
Northwest casts a bearish shadow on gas prices as increased hydropower generation is
expected to cut into gas-fired power gen demand. Last week’s storage recorded an 85bcf
withdrawal, in line with consensus. Current storage sits at 1.75tcf and is in line with 2010.
In Europe, we published a strategy piece highlighting our preference for companies with
high free cashflow yields (Royal Dutch Shell, ExxonMobil, Oxy) and those with ability to
send incremental natural gas into the European markets (BG and Statoil) amid the rising
energy prices caused by the political tensions in the Middle East and Libya.
In other European news, BG announced successful completion of the Iara Horst well in
the Santos Basin, offshore Brazil. The well confirmed good quality oil (28 degree API)
and better reservoir features than the initial discovery well. Total entered into a strategic
partnership with Novatek, taking 20% share on the Yamal LNG project to develop the
South Tambey field in the arctic area of the Yamal peninsula as well as acquiring 12.08%
shareholding in Novatek.
Within the Canadian Large cap space, a number of oil weighted companies closed the
week at 52-week highs, including Suncor, Imperial and Canadian Oil Sands, while others
were marginally off, such as Nexen, Canadian Natural and Cenovus. Share prices continue
to rally on commodity strength. This is particularly true for companies with oil exposure
priced off Brent (Nexen) and Syncrude (Canadian Oil Sands, Imperial, Nexen, Suncor).
In the Canadian oil field services space, quarterly earnings growth for Trican Well
Services and Calfrac Well Services stemmed from strong pricing and activity in the North
American market, while results from LatAm and Russian operations underperformed. At
the closing on Friday, Trican was down 4% WoW and Calfrac dropped 7%.
Our Canadian Oil & Gas research team initiated coverage on Zodiac Exploration (ZEX
CN) with an Outperform rating and C$1.50 target price. Zodiac offers a compelling way
for investors to play the unconventional oil resource wave in California. Results from its
first two wells in April/May 2011, are expected to be key drivers of the share price over
the next 6–12 months.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Oil & Gas Atlas
Energy large caps near 52-week highs
Energy Market Indices WoW Changes
⇒ S&P/TSX Energy Index: +2.0%
⇒ S&P 500 E&P Index: -1.0%
⇒ Oil Service Sector Index: +1.1%
⇒ UK FTSE Oil & Gas Producers Index: +0.1%
⇒ Asia Pacific Oil & Gas Producers Index: +2.7%
Weekly Market Recap
April WTI crude oil futures traded into the triple-digits last week and closed above
US$104/bbl on Friday, up 7% WoW. Unrest in the MENA region renewed concerns over
supply disruptions and pushed Brent prices to US$116/bbl, a US$12/bbl premium to WTI.
The DOE reported bullish inventory draws across the board, while Cushing levels gained
1.1mmbbl to a record high of 38.57mmbbl.
Henry Hub gas fell for three days straight before recovering slightly to US$3.81/mmbtu
on Friday. High snow pack and the outlook for above-normal rainfall in the US Pacific
Northwest casts a bearish shadow on gas prices as increased hydropower generation is
expected to cut into gas-fired power gen demand. Last week’s storage recorded an 85bcf
withdrawal, in line with consensus. Current storage sits at 1.75tcf and is in line with 2010.
In Europe, we published a strategy piece highlighting our preference for companies with
high free cashflow yields (Royal Dutch Shell, ExxonMobil, Oxy) and those with ability to
send incremental natural gas into the European markets (BG and Statoil) amid the rising
energy prices caused by the political tensions in the Middle East and Libya.
In other European news, BG announced successful completion of the Iara Horst well in
the Santos Basin, offshore Brazil. The well confirmed good quality oil (28 degree API)
and better reservoir features than the initial discovery well. Total entered into a strategic
partnership with Novatek, taking 20% share on the Yamal LNG project to develop the
South Tambey field in the arctic area of the Yamal peninsula as well as acquiring 12.08%
shareholding in Novatek.
Within the Canadian Large cap space, a number of oil weighted companies closed the
week at 52-week highs, including Suncor, Imperial and Canadian Oil Sands, while others
were marginally off, such as Nexen, Canadian Natural and Cenovus. Share prices continue
to rally on commodity strength. This is particularly true for companies with oil exposure
priced off Brent (Nexen) and Syncrude (Canadian Oil Sands, Imperial, Nexen, Suncor).
In the Canadian oil field services space, quarterly earnings growth for Trican Well
Services and Calfrac Well Services stemmed from strong pricing and activity in the North
American market, while results from LatAm and Russian operations underperformed. At
the closing on Friday, Trican was down 4% WoW and Calfrac dropped 7%.
Our Canadian Oil & Gas research team initiated coverage on Zodiac Exploration (ZEX
CN) with an Outperform rating and C$1.50 target price. Zodiac offers a compelling way
for investors to play the unconventional oil resource wave in California. Results from its
first two wells in April/May 2011, are expected to be key drivers of the share price over
the next 6–12 months.
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