|Day's Range||20.00 - 20.00|
Remember that 'gaps always fill,' and while I would avoid entering the name on Monday if you haven't already, here's how and why to look for a way in at the right time.
The drone attack on Saudi Arabia could have a far-reaching impact on oil prices as it eliminated roughly 5% of daily oil supply globally and it is not possible to mitigate these losses immediately.
The timing for higher oil prices couldn't be more convenient for BP. The company is divesting assets and is bringing online production from major projects.
Apple will launch a legal challenge on Tuesday to a European Commission order to pay 13 billion euros ($14.4 billion) in Irish back taxes in a landmark case in the EU's crackdown on tax avoidance by multinational companies. The iPhone maker is expected to send a six-man delegation headed by Chief Financial Officer Luca Maestri to the two-day court hearing at the Luxembourg-based General Court, the EU's second highest court. In August 2016, the Commission said tax rulings by Ireland in 1991 and in 2007 had artificially reduced Apple's tax burden for over two decades, effectively making it illegal state aid.
In the daily bar chart of Action Alerts PLUS holding BP, below, we can see that the stock price was already moving up ahead of this supply shock. The daily On-Balance-Volume (OBV) line turned up from the middle of last month signaling a shift from aggressive selling to aggressive buying. In this weekly bar chart of BP, below, we can see that the $36 area has been a key level the past two years and each time it was reached it was a buying opportunity.
Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of Midcoast Energy, LLC and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers. This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future.
The valuations of integrated energy stocks ExxonMobil, Chevron, Shell, and BP have been slammed in Q3, led by volatile equity markets and oil prices.
The U.S. topped Saudi Arabia in oil exports in June as Riyadh complies with the OPEC cuts, according to an industry report Wednesday.
While EIA reports the fourth straight weekly inventory decline, crude prices fall after OPEC cut its forecast for oil demand growth this year and next.
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Sign up here.BP Plc’s CEO plans to sell some oil projects and curb the development of others to align its business with the Paris accord, the latest sign climate concerns are starting to impact the investment decisions of the world’s largest fossil fuel producers.Senior BP executives met within the last few days to discuss how to cut carbon as it grapples with a shareholder resolution requiring the company to explain how its spending is aligned with Paris, Chief Executive Officer Bob Dudley said on a Wednesday conference call organized by JPMorgan Chase & Co.One proposal weighed up by BP’s management team was exiting the most carbon-intensive projects, though Dudley wouldn’t say which assets were targets because there are “governments and partners involved.”“We are certain we’ve got a path, it may not be linear, to being consistent with Paris goals,” Dudley said in conversation with JPMorgan’s head of European oil research Christyan Malek. “There are going to be projects that we don’t do, things that we might have done in the past. Certain kinds of oil, for example, that have a different carbon footprint.”His comments offer a response to increasingly severe criticism aimed at the entire oil industry over its contribution to man-made climate change. BP’s own shareholders sparred with company managers at its annual general meeting in May, before voting almost unanimously to require the company to issue a report about how each new investment is aligned with Paris. The report will be issued before its next AGM in May 2020.Still, the plan may prompt questions about how selling assets to another producer can help curb global emissions. For example, Dudley said on the call that the sale last month of BP’s oil and gas fields in Alaska helped it reduce its carbon footprint. But the buyer plans to invest more in the fields than BP would have, potentially increasing production and boosting emissions in the process.Dudley also pointed out the main driver of the Alaska sale was the fact those fields were struggling to compete for capital within BP because production there was unlikely to grow as much as at the company’s other projects. Dudley said he is driving down the entire company’s “break-even” point toward $50 a barrel, meaning projects will need to be cheap to stay within BP’s portfolio.Also read: BP Says Some of Its Oil ‘Won’t See the Light of Day’Dudley said he’s juggling with the challenge of investing in relatively low-return renewables businesses while maintaining the company’s large dividend. He took aim at those who didn’t acknowledge how beneficial it is when BP does invest in low-carbon technology, saying any assessment of its carbon footprint should probably include the emissions it avoids.“We’ll reduce the emissions from our operations, reduce the emissions from our products and come up with the new business models,” he said. “If you add all those figures up in reductions of greenhouse gas -- for example, we have a big solar business, a big biofuel, wind business -- you almost get no credit when you do those calculations.”While he has maintained the company’s business model already aligns with the Paris accord, he said having to issue a report to benchmark progress has caused BP to think further about its spending.Carbon TrackerA report by Carbon Tracker last week said BP’s most polluting investments are the Zinia 2 project in Angola and the Azeri-Chirag-Gunashli development in Azerbaijan, and that neither are compatible with the Paris goals.“Our strategy is to produce advantaged barrels, which involves considering factors like whether they are economic to produce, low risk to bring to market and lower carbon from an emissions standpoint,” a BP spokeswoman said in response to the Carbon Tracker assessment. These “could help to push other more costly and high-carbon barrels out of the mix, just as gas can help to push coal out of the power mix.”BP is also seeking to divest assets because its debt is too high, Dudley said on the call, constraining his spending power. It has announced about $7 billion of a $10 billion disposal program linked to the purchase of shale fields from BHP Group Ltd. last year. An earlier plan to meet that target by selling older onshore gas fields was complicated by the price of natural gas falling, he said.BP became the operator of the BHP fields in March, which has now caused other complications to the British company’s climate ambitions. Dudley said the level of flaring, the deliberate burning of methane at the place it’s produced, is “not right,” and he is working to reduce it. Earlier this week, the company announced it was adding new equipment to its projects to quantify and identify methane leaks.(Updates with comments on break-even price in seventh paragraph.)To contact the reporter on this story: Kelly Gilblom in London at email@example.comTo contact the editors responsible for this story: James Herron at firstname.lastname@example.org, Helen Robertson, Amanda JordanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
There's a nice bull case for Exxon Mobil (NYSE:XOM) at the moment. Earnings are set to grow at a nice clip going forward. Exxon stock pays an attractive dividend. Downstream and chemical operations provide a hedge to oil price weakness.Source: Jonathan Weiss / Shutterstock.com Indeed, XOM stock has rallied nicely since touching a 2019 low last month. Thanks in part to the generous dividend, I predicted in July that $70 would hold as a floor for Exxon stock.That didn't quite play out, as XOM went to $66, but the dip below $70 - and to a 5%+ yield - proved to be short-lived.InvestorPlace - Stock Market News, Stock Advice & Trading TipsBack at $72, Exxon Mobil stock still looks attractive, but it's not perfect. There are reasons why XOM stock has been dropping for the past five years. And there are plays elsewhere in energy that might be more compelling. XOM still looks like the easiest play in energy. But easiest isn't always the best. The Case for Exxon StockThe case for Exxon stock has two pillars. First, earnings are set to grow sharply over the next few years. CEO Darren Woods said last year that Exxon Mobil would double its profits by 2025. * 10 Stocks to Sell in Market-Cursed September The company said in May that the plan remained on track. It noted at its March Investor Day that it could reach those goals with flattish oil prices and even assuming demand was cut to meet climate change targets.The second, related, pillar is that the earnings growth can support continuing increases in the dividend, which can further support Exxon Mobil stock. To be sure, I'm not a fan of buying a stock for its dividend. That's a dangerous play, a lesson learned by shareholders of General Electric (NYSE:GE) and CenturyLink (NYSE:CTL), to name just two.But Exxon Mobil has some internal protections to its earnings thanks to its downstream and chemical operations. When oil prices fall, profits in upstream (exploration and production) drop. But they usually increase elsewhere in the business. Even as oil absolutely collapsed in the middle of the decade, XOM stock held up - and the dividend kept growing.In an environment where 10-year Treasuries yield less than 2%, it's difficult to believe that Exxon can yield 5% or more for very long. Last month's move to under $70, as noted, was short-lived.So Exxon Mobil stock is probably safer than some investors realize. Given its growth potential going forward, it's cheaper than some investors realize. That's a nice combination.And it suggests a path to $100 or more, given plans to move EPS above $8 and the dividend potentially to $4+. Give Exxon a mid-teen P/E multiple or a 4% yield and the stock gains 50% or so from current levels: including dividends, likely double-digit annual returns. The RisksThat said, even if risks are lower here than elsewhere in energy, risks aren't zero. Climate change worries could drive lower energy demand amid both government regulation and changing consumer behavior. It's not just Tesla (NASDAQ:TSLA) pushing electric vehicles, after all.Lower gasoline demand doesn't send Exxon Mobil profits to zero, as oil has other uses. But it does pressure Exxon Mobil earnings, and thus the XOM stock price.Another factor is the role of ESG (environmental, social and governance) investing. Those funds may avoid Exxon stock, lowering demand in the market and potentially keeping a modest ceiling on performance going forward.Finally, Exxon Mobil has to actually hit its targets - and get some help from oil prices in the process. Lower oil prices, too, don't send Exxon Mobil earnings to zero. But if EPS is $6 in 2025 instead of $8+, Exxon's next five years could look like the last five. Over that time, shareholders have lost about 10% of their investment, even including dividends. The Bottom Line on Exxon StockThe other question is whether there are other more attractive plays in the energy sector. It's worth remembering that the same internal hedge that protects earnings in a lower oil-price scenario also makes XOM stock a notably poor play on oil prices.Investors bullish on oil should look elsewhere, particularly with prices cheaper across the space. Both Exxon and Chevron (NYSE:CVX) have said that they expect shale M&A to continue, after Occidental Petroleum (NYSE:OXY) acquired Anadarko Petroleum earlier this year.Concho Resources (NYSE:CXO) has been considered a logical acquisition target and is much cheaper after a post-earnings plunge. Other shale plays have fallen steadily since spiking after the Oxy-Anadarko bidding war.Even in integrated oil, there are some intriguing plays. Chevron has been a better stock in recent years. BP (NYSE:BP) has a higher dividend.Again, XOM the simplest play in the space. It's likely, given its dividend, to preserve capital even if oil prices move to a so-called "lower for longer" scenario. But there are intriguing options as well. Oil bulls should look elsewhere. Income investors should take a look at BP. Exxon stock is a good option, but it's likely it won't turn out to be the best one.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Sell in Market-Cursed September * 7 of the Worst IPO Stocks in 2019 * 7 Best Stocks That Crushed It This Earnings Season The post The Bull Case for Exxon Stock Is Strong, but It's Not Perfect appeared first on InvestorPlace.
ExxonMobil's (XOM) decision to sell Norway oil & natural gas assets reflects strong focus on boosting oil equivalent volumes from American onshore shale resources.
About the upcoming U.S./China talks, call me skeptical, but I trade the environment, and not my starchy views on what is versus what should be.
Oil major BP plans to sell more U.S. crude to Asia as its shale oil production grows, seeking to capitalise on growth in the world's key demand region. The strategy, outlined in a Reuters interview with company executives, follows BP's move to acquire giant miner BHP's assets in the United States' prolific Permian shale basin last year, expected to give its portfolio a boost in light-sweet crude production. "This (Asia) is a key growth region" for energy demand, said Sharon Weintraub, BP's chief executive officer of supply and trading for the eastern hemisphere.
BP reportedly announces that the escalating tariff war between the United States & China, and growing fears of recession have been denting demand for oil and refined petroleum products.
Crude oil spikes after Saudi drone bombings over the weekend and questions pervade about how the U.S. should respond. Yahoo Finance's Julie Hyman, Adam Shapiro, Brian Sozzi, Scott Gamm and Bob McNally Rapidan Energy Group Founder and President discuss.