The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.
0906 ET - Oil futures are steady in early U.S. trading, with WTI for December delivery making its debut at the front of the curve. Yesterday's high of $110 a barrel for the expiring November contract "provides an eventual upside target to WTI when looking across the next 1-2-week time frame," Ritterbusch & Associates says in a note. The firm cautions against chasing WTI higher above $102 "since the bulk of the past week's upside price acceleration appears attributable to increased risk appetite rather than a shift in global crude balances." December WTI is off 0.1% at $97.72 a barrel and Brent is down 0.3% at $108.51 a barrel. (anthony.harrup@wsj.com)
0830 ET - U.S. natural gas futures extend their slide into a fourth session with near-term weather forecasts shedding heating demand. "That has dropped us down through the support around $3 and even below the firmer support at $2.90," Tradition Energy's Gary Cunningham says in a note. With gas for January delivery firmly under $4, it could drive some hedging interest as international buyers still rely on U.S. supplies due to continued restrictions on LNG out of the Persian Gulf, giving support to the December-February strip, he says. Natural gas for November delivery is down 4% at $2.844/mmBtu.(anthony.harrup@wsj.com)
0616 ET - Lingering concerns over debt-funded AI investments have seemingly left the dollar more vulnerable to any falls in oil prices, ING's Francesco Pesole says in a note. Rising concerns about tech stocks have challenged U.S. interest-rate rise bets, providing more flexibility for rate expectations to adjust lower in the case of lower oil prices, he says. The balance of risks have shifted towards a softer dollar, he says. "Even so, we continue to favor a gradual and orderly dollar decline rather than a sharper depreciation." The continued prospect of Federal Reserve tightening and elevated oil prices remain supportive, he says. The DXY dollar index rises 0.1% to 101.791 after hitting a near three-week low of 101.506 Tuesday when oil prices slipped. (renae.dyer@wsj.com)
0605 ET - Maersk shares look expensive when considering potential midterm returns and free cash flow, UBS analyst Cristian Nedelcu writes. The bank says container shipping has been in a sweet spot over the last three years, with demand outpacing expectations and supply disruptions supporting ocean freight rates. The share price of the Danish shipping group is up 60% year to date, with the market extrapolating the current unusually supportive conditions into the future, he adds. As capacity grows and congestion eases, alongside some downside risk to Asia-Europe demand, UBS sees scope for rates and industry cash generation to moderate. The bank downgrades its rating to sell from neutral and lifts its price target to 19,680 Danish kroner from 17,800 kroner. Shares fall 2% to 23,570 kroner. (dominic.chopping@wsj.com)
0520 ET - Approving the offshore U.K. gas field Jackdaw is the right decision but it won't stop the damage being done to the North Sea oil and gas sector, an INEOS spokesperson says. Heavy taxes and delayed decisions are driving away investments that generate jobs, production and tax revenues, the chemicals manufacturer says. Maintaining the 78% tax on U.K.-derived oil and gas profits in the upcoming budget will compound the challenge, the spokesperson says. (adam.whittaker@wsj.com)
0508 ET - The U.K. government was right to approve the Jackdaw gas field, and it is better for the country's climate targets and economy, energy analysis group Wood Mackenzie says. "Blocking Jackdaw would require the U.K. to import more emissions-intensive LNG to meet U.K. gas demand", the group's Gail Anderson writes. Blocking it would have increased emissions, not reduced, Anderson adds. Meanwhile, if approval had been withheld it would have sent a negative signal to oil companies operating in the basin, and would have likely seen over 20 billion pounds of greenfield investment lost, Wood Mackenzie says.(adam.whittaker@wsj.com)
0332 ET - Oil prices rise in early European trading, as continued attacks on shipping in the Strait of Hormuz threaten flows, while U.S. industry data points to falling crude and product inventories. "Oil markets have held onto their recent gains, shaking off headlines on the diplomatic stance between Iran and the U.S.," says Soojin Kim, analyst at MUFG. Brent crude is up 0.9% to $109.80 a barrel, while WTI futures gain 0.9% to $98.72 a barrel. According to reports citing American Petroleum Institute data ahead of official EIA figures later on Wednesday, U.S. crude stocks fell by 4.9 million barrels last week, along with draws in gasoline and distillate inventories. (giulia.petroni@wsj.com)
0309 ET - The dollar recovers as Treasury yields rise and oil prices push higher on worries over supply disruptions due to the Middle East conflict. The dollar is also supported by safe-haven flows and a weaker euro amid ongoing concerns about French debt. On Tuesday, the dollar hit a near three-week low against a basket of currencies following weak U.S. housing data. The dollar's falls also reflected rumors of progress in U.S.-Iran talks, which briefly lowered energy prices, but the move faded overnight, Danske Bank's Jens Naervig Pedersen says in a note. The DXY dollar index rises 0.1% to 101.778 after falling as low as 101.506 Tuesday. (renae.dyer@wsj.com)
0200 ET - Energy storage is likely the critical technology that addresses India's renewable energy issues, Nomura analysts say in a research report. These include renewable energy curtailments at around 35 gigawatts in summer 2026 and non-solar-hour reserve margin at 5%-6% below Central Electricity Authority's optimum margin through FY 2036, the analysts say. Nomura prefers Acme Solar Holdings over NTPC Green Energy as the former looks better placed to capture India's energy storage opportunities due to its faster execution. The brokerage initiates coverage of Acme Solar with a buy rating and a target price of 505.00 rupees and coverage of NTPC Green Energy with a neutral rating and a target price of 100.00 rupees. Shares of Acme Solar and NTPC Green Energy were last quoted at 404.70 rupees and 84.59 rupees, respectively.
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