The energy sector is poised for a mixed start to higher, weighed down by weakness in underlying commodities, but supported by strength in major equity futures which rose in early trading as as traders pored over more corporate earnings reports a day after the market failed to hold. a lively rally. Earnings season has also kicked off for space with Halliburton posting a nearly 41% increase in second Quarter adjusted earnings over the first quarter, and predicting several years of growth in drilling demand. Driven by high oil prices, the increase came despite a $344 million hit from the company which cut its assets in Russia in response to its invasion of neighboring Ukraine.

WTI and Brent crude oil futures fell this morning, pulling back from yesterday’s rally above $5 amid fears that an economic slowdown will affect demand for oil, but tight supplies and a weaker dollar dampened some losses. Expectations of an increase in US crude inventories also weighed on prices, with analysts expecting US crude and distillate supplies to rise last week, while gasoline inventories likely fell. . The US Dollar was hovering around a one-week low this morning.

Natural gas futures fell this morning, shrugging off yesterday’s rally that took the first month to a five-week high, following weakness in the crude complex. The declines came despite forecasts of warmer weather and stronger-than-expected demand this week.

BY SECTOR:

INTEGRATED IN THE UNITED STATES

Improved Piper Sandler ExxonMobil to Overweight from Neutral.

INTERNATIONAL INTEGRATED

Worley announced that it has been awarded two contracts for project management services for from Aramco unconventional gas program in North and South Arabia and Jafurah. Under the contracts, it will provide Initial Engineering Design (FEED), Detailed Design Assistance, Project Management Services and Construction Management Services.

A Milan appeals court has acknowledged the dropping of criminal charges in a Nigeria corruption case, finalizing the acquittal of Eni and Shellas well as managers including the CEO of Eni, Claudio Descalzi.

Equine announced that production from the Peregrino field in Brazil resumed on July 16, with the aim of increasing production and reducing emissions intensity.

The Petroleum Safety Authority Norway (PSA) has issued an order Equinefollowing an audit of its life extension unit (FLX) and maintenance management on Statfjord A.

Petrobras scheduled for August 19 a meeting of shareholders to consider a new list of proposed board members, he said in a securities filing. The company’s shareholders will vote to elect eight new board members, including its proposed new chairman, Gileno Gurjao Barreto. Caio Paes de Andrade, who took over from Jose Mauro Coelho as the oil giant’s interim chief executive, is also expected to be confirmed in his role. Coelho resigned at the end of June under pressure from President Jair Bolsonaro.

Petrobras informed that, in an extraordinary meeting, its board of directors, meeting in a session at which only its members were not proposed for a new election, fully validated the analyzes made by the eligibility committee (CELEG) concerning the candidates proposed by the controlling shareholder and minority shareholders for the company’s CA, according to the minutes of the CELEG meeting of 07/13/2022, as well as, by majority, the analysis made by the CELEG during the Committee meeting of 06/24/2022.

Abu Dhabi National Oil Company (ADNOC) and TotalEnergies signed a strategic partnership agreement to deepen their longstanding partnership and explore new growth opportunities across the entire energy value chain. Under the terms of the agreement, ADNOC and TotalEnergies will explore opportunities for collaboration in areas of mutual interest, including gas growth, carbon utilization and storage (CCUS), trading and product supply.

TotalEnergies signed with Sonatrach, western and Eni an extension of its Production Sharing Contract for a period of 25 years for onshore Blocks 404a and 208 in the Berkine basin, in eastern Algeria.

CANADIAN INTEGRATED

No significant news.

E&PS United States

PAA provided additional information regarding certain second quarter 2022 financial and operating results. Brent oil on PSC volumes in Egypt and lower gas production in Egypt. This was partially offset by higher production in the North Sea due to a change in the scheduled maintenance schedule at the Beryl field. US production for the period is forecast at 200 Mboe/d, against a forecast of 206 Mboe/d. Approximately 4 Mboe/d of the difference is attributable to non-recurring adjustments from prior periods, mainly related to the performance of untapped wells. The remainder is associated with mixed production results from certain Austin Chalk wells brought on stream during the quarter.

BofA Global Research downgraded California Resources to underperform from the buy.

BofA Global Research updated Conoco Phillips buy from neutral.

BofA Global Research downgraded Denbury to underperform from neutral.

BofA Global Research updated EOG Resources buy from neutral.

Warren Buffett’s Berkshire Hathaway says it bought an additional 1.94 million shares of western oilbringing her closer to a threshold where she could save some of the oil company’s profits with her own.

BofA Global Research updated Ovintiv buy from neutral.

BofA Global Research downgraded Pioneer of natural resources to underperform from neutral.

CANADIAN E&PS

No significant news.

OIL SERVICES

Halliburton reported net income of $109 million, or $0.12 per diluted share, for the second quarter of 2022. This compares to net income for the first quarter of 2022 of $263 million, or $0.29 per diluted share. diluted stock. Adjusted net income for the second quarter of 2022, excluding impairment and other charges, was $442 million, or $0.49 per diluted share. That compares to adjusted net income in the first quarter of 2022, excluding impairment and other charges and a loss on early extinguishment of debt, of $314 million, or $0.35 per diluted share. Halliburton’s total revenue for the second quarter of 2022 was $5.1 billion, compared to revenue of $4.3 billion in the first quarter of 2022. Reported operating profit was 374 million in the second quarter of 2022, compared to reported operating income of $511 million in the first quarter of 2022. Excluding impairment and other charges, adjusted operating income was $718 million in second quarter of 2022, compared to adjusted operating income of $533 million in the first quarter of 2022.

DRILLERS

No significant news.

REFINERS

No significant news.

MLPS & PIPELINES

EnLink’s The Board of Directors declared a cash distribution of $0.1125 per Common Unit for the second quarter of 2022, which is unchanged from the first quarter of 2022 distribution. The second quarter of 2022 cash distribution will be paid on August 12, 2022 to unitholders of record on July 29, 2022.

According Reuters, Kinder Morgan Natural Gas Pipeline Company of America LLC has declared a Force Majeure Event due to pipeline rehabilitation work on the Gulf Coast Main Line #1.

BofA Global Research updated Plains All American Pipeline LP to neutral from underperforming.

BofA Global Research updated Plains GP Holdings LP to neutral from underperforming.

The 590,000 barrel-per-day Keystone pipeline was operating at reduced capacity on Monday, operator TC Energy said, after a third-party power utility in South Dakota was damaged. TC Energy said a force majeure event has been declared on Keystone and repairs are underway, but there is currently no timeline for restoring full service.

MARKET COMMENTARY

Wall Street futures rose as Apple shares gained and investors focused on another round of earnings to gauge the strength of US companies. European stocks were trading higher ahead of the ECB’s policy meeting this week. Japanese stocks ended with modest gains as investors balked at making big moves ahead of the Bank of Japan’s policy meeting this week. The euro appreciated against the dollar, while gold prices strengthened. Oil prices softened on expectations that US inventories may have risen last week. Netflix is ​​expected to release its second quarter results after the market closes.

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