Crude oil is on course for the second weekly fall as more countries join in the release of reserves

The energy sector is poised to start higher, supported by strength in the crude oil complex and major equity indices. US stock futures edged higher, posting a two-day decline, despite concerns over the Federal Reserve’s aggressive moves to tame inflation and the ongoing conflict in Ukraine.

WTI and Brent crude oil futures were up in early trading, but remained on course for a second weekly decline after countries announced plans to release crude from strategic inventories. The IEA has listed members’ contributions to a release of 120 million barrels of crude and petroleum products from emergency stocks aimed at cooling global oil prices after Russia invaded Ukraine. The stock release by the IEA’s allied U.S. members would be their second coordinated release in a month and fifth in the agency’s history. The United States will match the 60 million barrels tapped by other IEA countries as part of its 180 million barrel draw from the U.S. Strategic Petroleum Reserve announced in March. The total release of 240 million barrels will be made available to the global market within six months. Record volumes of fuel oil from Latin America landed in the United States in March as refiners found alternatives to Russian feedstock ahead of the April 22 deadline set by Washington to end US imports of Russian oil. Russia’s share fell to 20% last month, while Latin American countries – driven mainly by Mexico – supplied 35% of fuel oil imports, the blending base for heating oil and vacuum gasoil , compared to 20% last year.

Natural gas futures rose as NOAA’s 6-10 day outlook shows below normal temperatures in the western and central United States, with above normal temperatures likely for most of the eastern United States and along the Gulf Coast.

BY SECTOR:

INTEGRATED IN THE UNITED STATES

The chairman of the ad hoc board of the Venezuelan state oil company PDVSA, which controls some of its most important foreign assets, said it was very likely that Washington would extend Herringbone license to operate in the South American country.

INTERNATIONAL INTEGRATED

Eni and the Government of Rwanda have signed a Memorandum of Understanding (MoU) to identify opportunities for collaboration in the areas of circular economy, agriculture, forestry, innovation and information technology digital. Under the terms of the MoU, the two parties will assess the feasibility of circular economy projects focusing on used cooking oil and waste oil collection, waste management recovery and recycling. Areas of interest also include agriculture, in particular the production of bio-raw materials, and the transformation into low-carbon products. This is in addition to forestry, in particular the conservation of forests and the generation of carbon credits through a wide range of initiatives, such as reducing CO2 emissions from the wood energy value chain and others service activities.

Equine warned that its first-quarter results would be negatively impacted by between $400 million and $500 million of trading in natural gas derivatives used to hedge its physical deliveries.

Prosafe was declared the winner of a bidding process for a four-year contract by Petrobras for the supply of the semi-submersible vessel Safe Notos for safety and maintenance off the coast of Brazil. However, the potential award of a contract and the timing of contract award is subject to a formal process in which other bidders may appeal over the next week.

CANADIAN INTEGRATED

No significant news.

E&PS United States

Reuters reported that Conoco Phillips is working with an adviser to sell some of its Eagle Ford Basin assets in Texas worth about $100 million as it steps up divestments to benefit from rising energy prices.

Truist Securities initiated coverage on Crescent Point Energy with a buy rating.

earth stone energy announced that its subsidiary, Earthstone Energy Holdings, LLC, has priced the previously announced private offering of $550 million aggregate principal amount of 8.0% senior unsecured notes due 2027 .

According to SECOND filing, April 1, 2022, Ovintiv entered into an amended and restated credit agreement dated April 1, 2022 between Ovintiv, as borrower, JPMorgan Chase Bank, NA, as administrative agent, and the original lenders and original issuing banks therein are named, amending and restating this Credit Agreement, dated January 27, 2020, between Ovintiv, as Borrower, JPMorgan Chase Bank, NA, as Administrative Agent, and the Original Lenders and Original Issuing Banks who are named there. The US credit agreement provides for total revolving commitments of $2.2 billion, with a termination date of July 15, 2026, unless the termination date is extended in accordance with the terms of the agreement. On April 1, 2022, the Canadian Subsidiary entered into an amended and restated credit agreement dated April 1, 2022, between the Canadian Subsidiary, as borrower, Ovintiv, as guarantor, the financial institutions parties thereto -ci, as lenders, and Royal Bank of Canada, as agent, amending and reaffirming this credit agreement, dated January 27, 2020, between Canadian Subsidiary, as borrower, Ovintiv, in as guarantor, the financial institutions parties thereto, as lenders, and the Royal Bank of Canada, as agent. The Canadian Credit Agreement provides for aggregate revolving commitments of $1.3 billion, with a maturity date of July 15, 2026, unless the maturity date is extended in accordance with the terms thereof.

CANADIAN E&PS

No significant news.

OIL SERVICES

No significant news.

DRILLERS

No significant news.

REFINERS

No significant news.

MLPS & PIPELINES

Enterprise Products Partners LP announced that the board of directors of its general partner has declared the quarterly cash distribution paid to limited partners holding common units of Enterprise for the first quarter of 2022 of $0.465 per unit, or $1.86 per unit on a annualized. The quarterly distribution will be paid on Thursday, May 12, 2022 to ordinary unitholders of record at the close of business on Friday, April 29, 2022. This distribution represents an increase of 3.3% over the distribution declared for the first quarter of 2021. .

TC Energy launched an open season to solicit binding commitments for crude oil transportation services on the Marketlink Pipeline System with an origin in Cushing, OK, and destinations in Port Arthur and Houston, TX.

MARKET COMMENTARY

US stock index futures were higher, although gains were limited as the prospect of aggressive global rate hikes and geopolitical risks weighed on sentiment. European stocks rallied as investors focused on the French presidential elections this weekend. Asian stocks ended in the green. The dollar index touched 100 for the first time in nearly two years, while gold was in negative territory. Oil prices have fallen due to stock releases by countries.


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