Welcome to the MarketReader Energy Minute.

Below are AI-generated insights on moves in the energy sector, powered by MarketReader technology.

Friday, September 13

XLE [+0.9%]
The Energy Select Sector SPDR Fund (XLE) has seen a daily increase of 0.07%, supported by significant movements among its holdings. Chevron (CVX) announced a collaboration with MOL to enhance LNG carrier efficiency, while Exxon Mobil (XOM) is ramping up production at its Baton Rouge refinery following Hurricane Francine and has secured a deal for a low-carbon ammonia facility in Texas. Oil prices have rebounded, with Brent crude rising to $72.43 per barrel and West Texas Intermediate reaching $68.60 per barrel, amid concerns over supply disruptions from Hurricane Francine, which has impacted 42% of U.S. Gulf of Mexico output. Additionally, the Michigan Consumer Sentiment index improved to 69.0, surpassing expectations and positively influencing XLE. Expectations of a potential Federal Reserve interest rate cut next week are also contributing to market sentiment towards energy stocks.

USO [+1.5%]
United States Oil Fund LP (USO) has seen its price increase by 1.3% during market hours on Friday, coinciding with significant supply disruptions in the U.S. Gulf of Mexico due to Hurricane Francine. The storm has resulted in a loss of approximately 42% of offshore crude oil production and 53% of natural gas production, as reported by the U.S. Energy Information Administration. This disruption has led to the evacuation of 169 offshore platforms and reduced operational rates at several refineries in the region. Additionally, WTI crude oil futures rose by 1.1% to $69.75, while Brent oil futures traded at $72.43 per barrel, reflecting the heightened supply concerns amid expectations of aggressive interest rate cuts by the Federal Reserve, which may boost demand for crude oil.

BOIL [-0.9%]
ProShares Ultra Bloomberg Natural Gas (BOIL) has seen a price increase of 0.2% since Thursday. Natural gas prices are currently rallying near 2.58, driven by concerns over tropical storm Francine, which threatens to disrupt supply. Additionally, geopolitical tensions between Russia and Ukraine are raising alarms about potential impacts on European gas supplies. Recent indications from the Federal Reserve regarding a possible interest rate cut have also introduced increased volatility in energy markets, directly affecting natural gas pricing dynamics. On September 12, U.S. markets experienced gains, supported by expectations of a Federal Reserve rate cut following inflation data. This backdrop contributed to a positive market sentiment that likely influenced the price movement for ProShares Ultra Bloomberg Natural Gas.

RYDAF | $32.84 | -3.5% | -7.4B

XOM | $112.26 | +0.9% | +4.5B

CVX | $141.24 | +1.4% | +3.7B

NFE | +4.1% | +96.1M
New Fortress Energy Inc | Oil & Gas Storage & Transportation
New Fortress Energy Inc has seen its stock price rise by 4.3% today. Over the past three months, five analysts have issued ratings on the company, with two bullish and three indifferent. The average price target has dropped significantly from a previous $32.20 to $19.60, a decline of over 39%. Notable adjustments include BTIG maintaining a Buy rating while reducing its price target from $35 to $15. Deutsche Bank lowered its target from $26 to $21, and Stifel cut its Buy rating target from $40 to $17. Additionally, the company recently went ex-dividend at $0.10 per share. Despite these challenges, New Fortress Energy is currently outperforming its sector peers.

OVV | +1.1% | +118.8M
Ovintiv Inc | Oil & Gas Exploration & Production
Ovintiv Inc (OVV) has experienced a price increase of 1.4%, aligning with the upward movement in the Oil & Gas Exploration & Production sub-sector. Notably, Diamondback Energy Inc (FANG) has risen significantly, which may correlate with OVV's performance. Analyst sentiment remains divided, with three bullish, three somewhat bullish, and three indifferent ratings following a slight increase in somewhat bullish assessments. The average 12-month price target for Ovintiv has decreased to $57.56, reflecting a high estimate of $62.00 and a low of $51.00. JP Morgan has lowered its target from $60.00 to $51.00, while Truist Securities has raised its target from $60.00 to $62.00. Financial metrics show a net margin of 14.86%, ROE at 3.3%, and ROA at 1.72%.

OXY | +1.4% | +656.5M
Occidental Petroleum Corp | Integrated Oil & Gas
Occidental Petroleum Corp is experiencing an increase in its stock price, aligned with significant upward movement in the Integrated Oil & Gas sub-sector. The company's subsidiary, 1PointFive, has secured up to $500 million from the U.S. Department of Energy to support the South Texas Direct Air Capture Hub. Initial funding of $50 million will be allocated for engineering, permitting, and procurement efforts. This facility aims to capture 500,000 metric tons of CO2 annually, with future plans to scale to over 1 million metric tons. There is potential for total funding to rise to $650 million for expanding a regional carbon network in South Texas, marking a notable advancement in commercial-scale direct air capture initiatives in the U.S.

RRC | +0.9% | +64.9M
Range Resources Corp | Oil & Gas Exploration & Production
Range Resources Corp (RRC) has seen its stock price increase by 2.1% since Thursday. The company went ex-dividend for $0.08 per share, reflecting a payout ratio of 16.24%. In the broader market context, the Russell 2000 Index has risen by 1.48%, which often correlates with the performance of small-cap companies like RRC. Analysts have recently adjusted their earnings estimates for Range Resources, with Zacks Research lowering its FY2024 forecast from $2.05 to $1.92 per share, while the consensus estimate remains at $2.07. Additionally, Goldman Sachs and Wells Fargo have cut their price targets, contributing to a consensus rating of "Hold" with an average price target of $36.68.

XOM | +0.9% | +4.5B
Exxon Mobil Corp | Integrated Oil & Gas
Exxon Mobil Corp is increasing production at its Baton Rouge, Louisiana refinery, which has a capacity of 522,500 barrels per day. Production had been reduced to 20% during Hurricane Francine but is now nearing maximum output. An Exxon spokesperson confirmed that the facility sustained no significant damage or flooding. Additionally, Exxon has signed a project framework agreement with Mitsubishi for a low-carbon ammonia facility in Baytown, Texas. This facility aims to produce nearly carbon-free hydrogen and low-carbon ammonia, with a final investment decision expected in 2025 and startup anticipated in 2029. Mitsubishi is also negotiating to acquire a stake in this project, which will supply ammonia for various industrial applications in Japan.

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