The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.
1826 ET - Ampol has plenty of tailwinds right now and management is doing well to capitalize on supportive conditions. But the stock is up roughly 1/3 in two months, and Jefferies believes now is the right time to take a breather. "After sharp outperformance, stock is on 16.5x mid-cycle price-to-earnings, making it harder to chase," says analyst Michael Simotas, downgrading Ampol to hold from buy. Jefferies finds all of Ampol's businesses are performing strongly. Geopolitical factors are difficult to predict, but it expects refined product markets to remain tight, supporting continued out-sized cash generation for the foreseeable future. Ampol ended Tuesday at A$43.80, just below Jefferies's A$45.00/share price target. (david.winning@wsj.com; @dwinningWSJ)
1823 ET - Australian stocks look set to follow U.S. equities lower after military strikes around the Strait of Hormuz caused a spike in oil futures and bond yields. ASX futures are down by 0.9% ahead of Wednesday's session, suggesting that the S&P/ASX 200 is on course for a third consecutive decline. The benchmark index has lost 0.4% so far this week amid growing expectations that the country's central bank will resume interest-rate rises later this month. Shares including in Origin Energy, Seek, PLS and Downer EDI will trade ex-dividend Wednesday. In the U.S., the DJIA fell 0.8%, the S&P 500 shed 0.7%, and the tech-heavy Nasdaq Composite dropped 1%. (stuart.condie@wsj.com)
1552 ET - Mexico's pipeline imports of U.S. natural gas were a record near 7.9 billion cubic feet a day in August, with gas for electricity generation in Mexico last month at an all-time high 5.8 Bcf/d, Wood Mackenzie says in a release. The firm projects that exports to Mexico have reached their 2026 peak. While volumes remain strong in early September, "Mexican gas and power markets are set to enter a gradual seasonal decline, driven by easing cooling loads, shoulder-season maintenance windows, and holiday-related demand softness." The medium-term trend remains upward, however, as Mexico continues expanding its fleet of combined-cycle power plants, Wood Mackenzie adds. (anthony.harrup@wsj.com)
1530 ET - U.S. natural gas futures end the session lower as the market remains well supplied despite late-summer heat extending into September. Production and LNG export activity are expected to see limited impact from Tropical Storm Edouard, which was making landfall along the Texas-Louisiana coast, although rain from the storm is seen lowering temperatures and cooling demand.Nymex natural gas for October delivery settles down 1.1% to $2.904/mmBtu. (anthony.harrup@wsj.com)
1512 ET - Oil futures rise sharply as the U.S. launches new strikes against Iranian targets and President Trump warns "they will be hit at a much harder and higher level" if Iran retaliates against the latest "justified attack." WTI settles up 5.2% at $90.22 a barrel, its highest close since July 23. "While the escalated conflict in the Middle East continues to slow Strait of Hormuz traffic, along with the continued global tightness in diesel fuel, the near-term path of least resistance for oil prices still looks higher," Dennis Kissler of BOK Financial says in a note. Brent rises 4.6% to $94.65 a barrel. (anthony.harrup@wsj.com)
1424 ET - Gold futures fall for a third straight session as a global bond selloff pushes yields up and the flare-up in the Middle East sends crude prices higher. The rise in oil prices raises concerns about inflation and implications for Fed interest-rate policy, particularly after Fed Chairman Kevin Warsh expressed concerns about inflation last week. Front month gold settles down 1.9% in New York at $4,348.00 a troy ounce. Silver falls 2.4% to $64.618 a troy ounce. (anthony.harrup@wsj.com)
1315 ET - Oil futures add to earlier gains as the U.S. military says it's carrying out more strikes on Iranian targets in response to Iranian attacks on ships and U.S. servicemembers in the Middle East. The renewal of military action has rekindled concerns about oil flows out of the Persian Gulf being choked off. WTI is up 4.3% at $89.43 a barrel after nearing $90 a barrel for the first time in over a month. Brent rises 3.9% to $93.89 a barrel.(anthony.harrup@wsj.com)
1156 ET - Gold futures are lower for a third straight session in response to rising bond yields and the jump in oil prices on renewed Middle East tensions. "A pricier crude could continue to tighten monetary policy expectations and drive yields higher, limiting any rebound potential for gold," DHF Capital's CEO Bas Kooijman says in a note. U.S. economic data including ISM surveys and Friday's payrolls could shape rate bets ahead of the Sept. 16 FOMC meeting, he says. "Softer figures could ease the pressure on gold, while stronger data or more hawkish Fed comments may extend the decline." Most active gold is down 1.4% in New York at $4,418.50 a troy ounce. (anthony.harrup@wsj.com)
1131 ET - Canada's planned nuclear buildout hinges on lowering its cost of capital through structural policy support rather than contractually shifting risk onto project developers, says CIBC's Krista Friesen. Pointing to a Canadian Nuclear Association report, Friesen says that "transferring risk contractually does not eliminate it," but that "assigning excessive risk to project participants can increase costs, weaken counterparties and ultimately undermine delivery." The report suggests financing frameworks must provide "cost-effective capital through predictable policy and market structures that reduce project risk and financing costs." She notes that by April 2027, the federal government is expected to release a draft policy on financing new nuclear projects and should "support further CANDU [a Canadian-designed reactor] deployment in Canada." (adriano.marchese@wsj.com)
1054 ET - Oil futures are higher with renewed strikes in the Persian Gulf, including attacks on two tankers carrying Saudi oil, increasing concerns about oil flows through the Strait of Hormuz. U.S. Treasury Secretary Scott Bessent says the strait will become less important as a chokepoint given alternative ways of getting oil out of the region. "In two years the Strait of Hormuz will be a worthless piece of water. The oil will be going on pipelines across land," he says in a fireside chat with Larry Kudlow of Fox Business. Bessent stressed the latest U.S. measures to squeeze Iran economically. The June MOU didn't work because Iran wasn't ready for a deal, he says. "My job is make sure they want to have a deal." WTI is up 2.2% at $87.62 a barrel. Brent rises 1.8% to $92.06. (anthony.harrup@wsj.com)
0929 ET - U.S. natural gas futures are returning yesterday's gains with the market continuing to weigh weather-driven demand against strong production and comfortable inventory levels. A near-record start to September cooling demand, and LNG recovering to four-month highs are supportive of Nymex gas, Eli Rubin of EBW Analytics says in a note. But Tropical Storm Edouard is likely to bring cooling rains as it approaches the Gulf coast and "the traditionally soft Labor Day weekend is ahead," he adds. Nymex natural gas is down 2.4% at $2.863/mmBtu. (anthony.harrup@wsj.com)
0926 ET - Soybean futures on the CBOT are up 1% premarket, breaching $13 a bushel for the first time since December 2023. Giving them support is news of the EPA revision of 2025 biofuel-blending exemption rules. The agency says that 1.76 billion in RINs are being exempted for small refineries in 2025, which is more than expected by the market. While on its face it doesn't appear supportive for soybean oil demand, traders are looking at what it means for the future. "They are expected to be re-allocated to 2026 and 2027, so the news was actually viewed as a little supportive as a smaller amount of exemptions was expected to be allowed," says Doug Bergman of RCM Alternatives in a note.
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