We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The Zacks Analyst Blog Highlights: EOG Resources, Whiting Petroleum, Exxon Mobil, Apache and Pioneer Natural Resources
Read MoreHide Full Article
For Immediate Release
Chicago, IL – December 1, 2017 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include EOG Resources, Inc. (EOG - Free Report) , Whiting Petroleum Corp. , Exxon Mobil Corp. (XOM - Free Report) , Apache Corp. (APA - Free Report) and Pioneer Natural Resources Co. (PXD - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
U.S. Crude Export to Asia Swells: Is OPEC Losing the Battle?
The increase in oil exports from the United States into the Asian markets can put pressure on the world markets as the supplies from OPEC may eventually be replaced with that of the United States.
U.S. crude oil exports to Asia last week hit the highest in two months, and the second-highest on record, at 877,000 barrels per day (bpd), according to data from Kpler. Of the total export, South Korea was the biggest buyer with imports of 357,000 bpd. It was followed by China and India who had imports of 222,000 bpd and 151,000 bpd, respectively. Indonesia and Japan were close with imports of 99,000 bpd and 47,500 bpd, respectively. In the first three weeks of November, the average export rate for U.S. crude to Asia was at 470,330 bpd.
Reasons Behind Growing U.S. Exports
There are two mains reasons behind the spur in US exports over the last few years.
In 2015, Washington lifted the forty-year old ban on oil exports. Per CNBC, the United States has never exported more than 2 million barrels of crude oil per day. During the week through Oct 27, the nation exported 2.13 million barrels a day of light oil, higher than 400,000 barrels shipped at the end of 2015.
On Nov 30, 2016, OPEC signed a landmark deal to curb oil output by 1.2 million barrels a day. Following the footsteps of the cartel, non-OPEC players headed by Russia decided to lower oil output by 558,000 barrels per day in December 2016.
Collectively, they decided to reduce crude production by 1.8 million barrels each day. On May 25, the cut in oil production was extended until the first quarter of 2018. It is expected that OPEC can extend the agreement through the end of 2018.
On Nov 30, OPEC and non-OPEC players will hold a meeting to decide on an extension of the crude production cut accord beyond first-quarter 2018. More than 20 oil producers, including leading exporters like Russia and Saudi Arabia, will participate in the Vienna meeting. The agreement entails putting roughly 1.8 million barrels a day of crude oil out of the market.
It can be assumed that the United States is gaining an edge over OPEC in the global crude market especially in Asia, considering that the cartel is lowering supplies to major crude buyers in compliance with the accord.
Why the Interest in U.S. Crude?
There are three main reasons behind the surging demand for U.S. crude. The crude is appropriate with the configuration of Asian refineries. These refineries process high quality so-called light, sweet crude that produce petroleum products such as gasoline and diesel.
U.S. crude is less expensive as the WTI trades at a steep discount to other oil benchmarks like Brent.
The cargoes are bought on a spot basis, providing refiners flexibility to balance the conventional Middle Eastern supplies that are sourced via long-term contracts.
Other Reasons
Political reasons also at play for this boom in US exports to Asia, per oil traders and refining executives. Sources believe that all regions including Tokyo, Beijing and Asian governments are trying to improve trade relationship with America. Hence, buying crude from the nation is considered a medium to promote the relationship with Washington.
Gainers
As per rig count data provided by Baker Hughes, a GE company, total U.S. drilling rigs increased dramatically from 404 — the lowest hit in May, 2016 — to 923 as of Nov 22, 2017. The current nationwide rig count is considerably higher than the prior-year level of 588. This signifies that more shale players have gathered in the United States, which has led to higher U.S. oil production and export.
Growing crude export is expected to benefit shale players like EOG Resources, Inc., Whiting Petroleum Corp., Exxon Mobil Corp., Apache Corp. and Pioneer Natural Resources Co.
These players will be able to sell their production. Amid low oil prices, these companies will benefit from low cost and high yielding asset
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
The Zacks Analyst Blog Highlights: EOG Resources, Whiting Petroleum, Exxon Mobil, Apache and Pioneer Natural Resources
For Immediate Release
Chicago, IL – December 1, 2017 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include EOG Resources, Inc. (EOG - Free Report) , Whiting Petroleum Corp. , Exxon Mobil Corp. (XOM - Free Report) , Apache Corp. (APA - Free Report) and Pioneer Natural Resources Co. (PXD - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
U.S. Crude Export to Asia Swells: Is OPEC Losing the Battle?
The increase in oil exports from the United States into the Asian markets can put pressure on the world markets as the supplies from OPEC may eventually be replaced with that of the United States.
U.S. crude oil exports to Asia last week hit the highest in two months, and the second-highest on record, at 877,000 barrels per day (bpd), according to data from Kpler. Of the total export, South Korea was the biggest buyer with imports of 357,000 bpd. It was followed by China and India who had imports of 222,000 bpd and 151,000 bpd, respectively. Indonesia and Japan were close with imports of 99,000 bpd and 47,500 bpd, respectively. In the first three weeks of November, the average export rate for U.S. crude to Asia was at 470,330 bpd.
Reasons Behind Growing U.S. Exports
There are two mains reasons behind the spur in US exports over the last few years.
In 2015, Washington lifted the forty-year old ban on oil exports. Per CNBC, the United States has never exported more than 2 million barrels of crude oil per day. During the week through Oct 27, the nation exported 2.13 million barrels a day of light oil, higher than 400,000 barrels shipped at the end of 2015.
On Nov 30, 2016, OPEC signed a landmark deal to curb oil output by 1.2 million barrels a day. Following the footsteps of the cartel, non-OPEC players headed by Russia decided to lower oil output by 558,000 barrels per day in December 2016.
Collectively, they decided to reduce crude production by 1.8 million barrels each day. On May 25, the cut in oil production was extended until the first quarter of 2018. It is expected that OPEC can extend the agreement through the end of 2018.
On Nov 30, OPEC and non-OPEC players will hold a meeting to decide on an extension of the crude production cut accord beyond first-quarter 2018. More than 20 oil producers, including leading exporters like Russia and Saudi Arabia, will participate in the Vienna meeting. The agreement entails putting roughly 1.8 million barrels a day of crude oil out of the market.
It can be assumed that the United States is gaining an edge over OPEC in the global crude market especially in Asia, considering that the cartel is lowering supplies to major crude buyers in compliance with the accord.
Why the Interest in U.S. Crude?
There are three main reasons behind the surging demand for U.S. crude. The crude is appropriate with the configuration of Asian refineries. These refineries process high quality so-called light, sweet crude that produce petroleum products such as gasoline and diesel.
U.S. crude is less expensive as the WTI trades at a steep discount to other oil benchmarks like Brent.
The cargoes are bought on a spot basis, providing refiners flexibility to balance the conventional Middle Eastern supplies that are sourced via long-term contracts.
Other Reasons
Political reasons also at play for this boom in US exports to Asia, per oil traders and refining executives. Sources believe that all regions including Tokyo, Beijing and Asian governments are trying to improve trade relationship with America. Hence, buying crude from the nation is considered a medium to promote the relationship with Washington.
Gainers
As per rig count data provided by Baker Hughes, a GE company, total U.S. drilling rigs increased dramatically from 404 — the lowest hit in May, 2016 — to 923 as of Nov 22, 2017. The current nationwide rig count is considerably higher than the prior-year level of 588. This signifies that more shale players have gathered in the United States, which has led to higher U.S. oil production and export.
Growing crude export is expected to benefit shale players like EOG Resources, Inc., Whiting Petroleum Corp., Exxon Mobil Corp., Apache Corp. and Pioneer Natural Resources Co.
These players will be able to sell their production. Amid low oil prices, these companies will benefit from low cost and high yielding asset
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
http://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.