The latest Market Talks covering Energy and Utilities. Published exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.
1624 ET - Brazilian oil-and-gas companies Brava Energy and Prio, both of which recently reported robust second-quarter profits, illustrate how Brazil's increasingly decentralized oil-and-gas sector enables smaller producers to thrive independent of state-controlled Petrobras, often by operating assets once owned by the energy giant, says Oscar Decotelli, chairman of Rio de Janeiro-based DXA Group, a private-market technology provider and investment firm. "I do not need Petrobras' balance sheet or its politics to make money in the Brazilian oil sector. I need a mature field [and] a disciplined operator," Decotelli says. Less reliance on Petrobras reduces perceived political risks for other Brazilian oil-and-gas producers and helps them attract foreign investors, he adds. Asset manager BlackRock in New York owned a roughly 7.5% stake in Prio at the end of June. (luis.garcia@wsj.com; @lhvgarcia)
1533 ET - Oklo has made progress on execution following several second-quarter milestones, Truist analysts write in a note, including the Thursday announcement that its Groves Isotope Test Reactor achieved a controlled, self-sustaining nuclear chain reaction -- a benchmark known as criticality. "We think the quarter showed Oklo reducing execution risk and building capabilities across power, fuel, and isotopes," the analysts write. Still, with the company reporting a $73.2 million loss from operations and just $1.2 million of revenue during the quarter, they write that the crucial question is how Oklo moves from first-of-a-kind economics to less costly, repeatable deployments. Shares climb 15%, and are up 28% this week.(elias.schisgall@wsj.com)
1522 ET - Talks aimed at reopening the Strait of Hormuz led crude prices lower this week, although futures pull back some going into the weekend with no deal signed. Obstacles to an agreement include reluctance by Iran's Islamic Revolutionary Guard Corps to give up leverage, its insistence on charging fees to use the strait, and the lifting of the U.S. blockade, Mizuho's Robert Yawger says in a note. Other problems are hostilities between Yemen's Houthis and Saudi Arabia, and between Israel and Hezbollah, he adds. WTI settles up 1.2% at $78.18 a barrel, but down 7.7% for the week. Brent rises 1.3% to $83.55 for a 5% weekly loss. (anthony.harrup@wsj.com)
1323 ET - Oil futures move higher as the weekend approaches with the market still waiting for news on a deal to reopen the Strait of Hormuz. "The underlying situation is becoming more precarious because the buffer that has kept the market functioning up until now has largely been global stock levels," Baringa energy analyst Ellen Fraser says in a note. "But that buffer is eroding and stock levels are reaching decade lows." WTI is up 1.4% at $78.36 a barrel and Brent is up 1.3% at $83.59. (anthony.harrup@wsj.com)
1322 ET - The U.S. continues adding oil rigs as the Middle East conflict drags on, keeping crude prices high. The number of rigs drilling for oil rose by three this week to 454, Baker Hughes reports, which is 43 more than a year ago when the world was facing prospects of an oil glut. U.S. crude production has risen this year, averaging 13.8 million barrels a day in recent weeks, according to EIA estimates. Rigs drilling for natural gas fell by three this week to 124, or one more than a year ago. (anthony.harrup@wsj.com)
0907 ET - Oil futures are returning some of yesterday's gains with the market still expecting some sort of deal to reopen the Strait of Hormuz. "While the reopening of the Strait of Hormuz is likely to drive a period of short-term market rebalancing and restore some confidence in global oil flows, any sense of stability is likely to be temporary," Joanne Salih, head of energy and resources strategy at Baringa, says in a note. "Even in the absence of active conflict, the possibility that Iran could again choose to restrict or close the strait will remain an enduring feature of the market." WTI is down 0.6% at $76.85 a barrel and Brent is off 0.8% at $81.87. (anthony.harrup@wsj.com)
0341 ET - European indexes largely edge higher in cautious trade as investors hold ground ahead of U.S. jobs data and news on talks in the Middle East. The Europe-wide Stoxx 600 adds 0.2% as software and healthcare sectors lead. London's FTSE 100 edges up 0.2%, with oil majors gaining as oil ticks higher. A Diageo rally continues into a second day, with the stock up 1.5%. The German DAX gains 0.4%. Software giant SAP gains 3.5%, though Daimler Truck Holding slips 2.9% after posting earnings. In Paris, the CAC 40 is 0.3% up as Dassault Systemes adds 2.4%, while Thales gains 1.9%. Italy's FTSE MIB is flat, while the Spanish IBEX 35 slips 0.3% as banking stocks weaken. The AEX edges 0.1% lower in Amsterdam.(josephmichael.stonor@wsj.com)
1943 ET - Oil rises in early Asian trade amid concerns over supply disruptions in the Middle East. The "Iranian-backed Houthi militant group said they had conducted a 'large-scale' attack on forces from Yemen's Saudi Arabia-backed government, killing and injuring 'hundreds' of troops," say ANZ Research analysts, noting media reports. "This is on the back of ongoing threats to shipping in the Red Sea, a key route for Saudi oil since the Middle East conflict began," the analysts say in a research report. Front-month WTI crude oil futures are 1.0% higher at $78.05 per barrel.
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